Sara has just graduated from college. She has determined that to purchase a home in 9 years she needs to accumulate $36,500 for a down payment. If Sara can earn 9% per year on her savings, what is the amount of the annual annuity payment that Sara must make at the end of each year for 9 years?

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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.