On December 31, 2023, ABC company borrows $480,000 from the First Bank to start a business. The loan requires quarterly payments for 10 years and the interest rate on the loan is 12%. ABC company's quarterly payment is:

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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.