You have borrowed $130,000 to buy a new c be repaid over 15 years at 6% compounded m table below, calculate the principal paid to the month. Month PMT 1 2 $449.25 $453.98 $443.66 $459.35 Interest Principal 1

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A: Future Value (Time Value of Money) In this question, we have to calculate the Future Value of a…

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A:

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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.