Suppose you borrowed $35,000 at a rate of 8.1% and must repay it in 4 equal installments at the end of each of the next 4 years. How large would your payments be? O a. $7,755.76 O'b. $11,585.00 O c. $11,948.43 O d. $9,797.19 O e. $10,590.76

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Q: 2.43 You have borrowed $28,000 at an interest rate of 12% compounded annually. Equal payments will…

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Q: Suppose that you took out a loan at 12% interest for 200 days. If the amount of interest was…

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Q: 9) Omar borrows AED 2,000,000 to be repaid over 15 years at 6% interest rate annually. Calculate…

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A:

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A: Principal Amount = p = $7000 Interest rate = r =  12% Interest amount = i = $672

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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.