Solve the Problem

Multiple Choice

Solve the problem. Use an annual percentage rate table if necessary.
-Sarah Yost took out a 48-month fixed installment loan of $20,000 to open a gift shop. She began making monthly payments of $507.25. Sarah's business does better than expected and instead of
Making her 36th payment, Sarah decides to repay her loan in full. How much interest will Sarah
Save (use the actuarial method) ?

A) $332.29
B) $290.89
C) $317.33
D) $334.79