Regina is attending a 4-year college. As a freshman, she was approved for a 10-year, federal unsubsidized student loan in the amount of $7,900 at 4.29%. She knows she has the option of beginning repayment of the loan in 4.5 years. She also knows that during this nonpayment time, interest will
accrue at 4.29%. If Regina decides to make no payments during the 4.5 years, the interest will be capitalized at the end of that period.
What will the new principal be when she begins making loan payments?
How much interest will she pay over the life of the loan?