Loan Interest Rate Length of Loan A 11.3% 60 months
B 10.3% 36 months

The cost of credit is the amount that a person pays over and above the amount borrowed.

Veronica borrowed $4,020.00 from City Credit Union. If she borrowed under Loan B, but paid the loan out in 18 months (without any penalties), what was her cost of credit compared to paying the loan out in 36 months?

P is the principal, r is the interest rate,
m is the number of monthly payments,
M is the monthly payment