The owner of the campus cafe plans to open a secound location on a satillite campus in 6 years. She buys an annuity that pays 11.5% interest compunded annually. Round your answer to the nearest cent.  a) If the payment is $3,000 a year, find the future value of the annuity in 6 years.  The future annuity is 24,040.15 b) How much more interest would be earned if the owener could invest the full amount paid into the annuity in a regular compound-interest account with the same terms for 5 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.