On the Day You Enter College, You Work Out a Deal

question 215

Multiple Choice

On the day you enter college, you work out a deal with your local bank such that you borrow $9,600 for four years. The terms of the loan include an interest rate of 5.9%. The terms also stipulate that the principle is due in full one year after you graduate. Interest is to be paid annually at the end of each year. Assume that you complete college in four years. How much will you pay the bank one year after you graduate?

• A) $566.40
• B) $2,265.60
• C) $10,166.40
• D) $11,865.60
• E) $12,432.00

---

Definitions:

Quasi-Contracts

Legal obligations imposed by a court to prevent unjust enrichment, even when no actual contract exists.

Implied-In-Law Contract

A legally enforceable agreement created by a court order, not explicit agreement, to ensure fairness and prevent unjust enrichment.

Actual Contracts

Legally binding agreements created by the actions, behavior, or circumstances of the parties involved, rather than by written or spoken words.

Arbitration Agreement

A contract in which parties agree to resolve disputes through arbitration instead of through the court system.