Solve the Problem

Multiple Choice

Solve the problem. Round to the nearest cent as needed.
-A bank has $750,000 to lend for 7 months. It can lend it to a local contractor at a simple interest rate of 12%, or it can lend it to a small business that will pay 12% compounded monthly. If the bank wants to maximize its
Interest earned, who should receive the loan (contractor or business) and what is the additional interest earned?

A) Contractor; $52,500
B) Business; $1601.51
C) Contractor; $1601.51
D) Business; $54,101.51