Determine the cost of credit for a $3,300 loan with a simple interest rate of 8% and a one-time payment to pay the amount in full at the end of a 4-year term. Round the answer to two decimal places as needed.(1 point)
The cost of credit is $
.
To calculate the cost of credit, we need to determine the amount of interest paid on the loan.
The formula to calculate simple interest is:
Interest = Principal * Rate * Time
Principal = $3,300
Rate = 8% = 0.08
Time = 4 years
Interest = $3,300 * 0.08 * 4 = $1,056
Therefore, the cost of credit is $1,056.