In order to finance Brenda’s education, she borrows $10,000 froma relative at an annual interest rate of 5%. Brenda promises to payher back in eight years. Which formula is correct for calculatingthe value of Brenda’s payment in eight years?
A)
$10,000(1 + 0.5)8
B)
$10,000(1 + 0.05)8
C)
$10,000(1 + 0.05)
D)
$10,000(1 + 5)
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