Rich is attending a 4-year college. As a freshman, he was approved for a 10-year, federal unsubsidized student loan in the amount of $7,300 at 4. 29%. He knows he has the option of beginning repayment of the loan in 4. 5 years. He also knows that during the nonpayment time, interest will accrue at 4. 29%.
a. How much interest will Rich accrue during the 4. 5 year nonpayment period?
b. What will be the new principal amount when Rich begins making payments?
