Part 4. Incorporating Loans and Conclusion
You need some money to get this business off the ground (marketing, initial materials, shipping,
etc...) and to use for marketing to increase your sales. You are considering three different loan
options. We estimate each loan would allow us to increase our sales by a flat percent, full data
shown below.
Loan Amount ($) APR Compounded Estimated increase in revenue
X 5,000 10% Monthly 10%
Y 7,500 9% Monthly 12%
Z 10,000 8% Monthly 14%
1. Fill in the table below with:
a. What's the APY for each loan? This is the actual percent you end up paying each
year.
b. If you wanted to pay off your loan in two years, find what your monthly payment
would need to be for each
C. If you wanted to pay off your loan in two years, how much money do you actually
end up paying?
Loan APY Monthly Payment Total Paid over 2 years
X
Y
Z