Jack borrows $7,000.00 at an interest rate of 15% compounded monthly to be paid off monthly payment of $180.00 If the length of the loan is 54 months, What is the total amount that would be needed to pay off the entire loan balance at the end of 6 months? $7,089.05 $9,752.75 $8,059.25 $6,467.70

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A: Loan amount=$2130Annual payment=$179Interest rate=7%Compounding quarterly.

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A: Given  Pv=300000*75%=225000 i=6%/12=0.5% n=30*12=360 Pv=pmt*(1-(1+i)^-n)/i

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Q: lack borrows $7,000.00 at an interest rate of 12% compounded monthly to be paid off monthly payment…

A: Dear student we need to use NPER function in excel to solve this problem.

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Cost of Credit

The cost of credit is an extra amount that the borrower has to pay besides the loan amount. These credit charges may vary from loan to loan. The cost of credit includes interest charges, maintenance charges, and arrangement charges. Some of the costs are mandatorily collected by the lender based on the loan amount and tenure of the loan. The cost of credit is also called finance charges of the credit.