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WILL MARK BRAINLY- Hudson always makes the minimum monthly payments on all of his

debts, on time. He receives a raise at work which gives him an extra $250

per month in take-home pay. If his primary goal is to minimize the amount

of interest he'll pay over the lifetime of his debts, which debt should he pay

down most quickly using his increased pay?*

His car loan with a 6.9% interest rate

His credit card with a 19.7% interest rate

His private student loans with an 11.8% interest rate

Ο Ο

O His Federal student loans with a 3.76% interest rate

Hudson has received pay rise and he is not sure about which loan to pay off first. Hudson should focus on interest amount rather than the principal amount. His car loan principal amount is higher of all other loans but the interest rate on his credit card is highest than all other interest rate. He should therefore focus on pay off his credit card loan first with the increase pay rise.

topeadeniran2 topeadeniran2 · Answer 2 · 2021-12-21T12:32:20+01:00

The debt that should be paid quickly will be B. credit card with a 19.7% interest rate.

From the information given, we are informed that Hudson always makes the minimum monthly payments on all of his debts, on time and that his primary goal is to minimize the amount of interest he'll pay over the lifetime of his debts.

Due to this reason, the best option for him is that he should focus on interest amount rather than the principal amount. Therefore, he should focus on the interest with teg largest interest rate.

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