Question: Todd Kowalski is borrowing $10,000 for five years at 7 percent. Payments are made on a monthly basis, which are determined using the add-on method.

Todd Kowalski is borrowing $10,000 for five years at 7 percent. Payments are made on a monthly basis, which are determined using the add-on method.
a. How much total interest will Todd pay on the loan if it is held for the full five-year term?
b. What are Todd’s monthly payments?
c. How much higher are the monthly payments under the add-on method than under the simple interest method?

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