A student is graduating from college in 12 months but will need a loan in the amount of $11,985 for the last two semesters. The student may receive either an unsubsidized Stafford Loan or a PLUS Loan. The terms of each loan are:

Unsubsidized Stafford Loan: annual interest rate of 3.85%, compounded monthly, and a grace period of six months from time of graduation

PLUS loan: annual interest rate of 4.15%, compounded monthly, with a balance of $12,491.95 at the time of repayment
Which loan will have a higher balance, and by how much at the time of repayment?



A: The PLUS loan will have a higher balance by $37.30 at the time of repayment.

B: The Stafford loan will have a higher balance by $37.30 at the time of repayment.

C: The PLUS loan will have a higher balance by $204.39 at the time of repayment.

D: The Stafford loan will have a higher balance by $204.39 at the time of repayment.