Carl is facing very difficult financial times and can only pay the interest on a $10,000 loan he has taken. The bank charges him a quarterly compound rate of 4%. What is the approximate interest he pays annually? Choose the correct choice.
A) $1750	B) $2000	C) $2150	D) $2500	E) $12000
An easy way too attempt this is by approximation:   For the first quarter, he pays 4% of 10,000 which is $400.   So for the four quarters in the year, he will approximately play  400*4= 
<gadget id="calculator"> 400*4</gadget>
<output>1_600</output>
1600 over the entire year.   Because of compound interest it will be more than 1600. Approx. option A is correct.   $1750nswer : $1750
<result>A</result>
Carl is facing very difficult financial times and can only pay the interest on a $10,000 loan he has taken. The bank charges him a quarterly compound rate of 4%. What is the approximate interest he pays annually?