Answer:
12.25%
Explanation:
Credit score is calculated for every customer. It is based mainly on 5 C’s of Credit (Collateral, Character, Capacity, Capital, Conditions). The stronger these 5 C’s are the higher will be an Individual or company’s Credit score. Higher Credit Score means that the Bank of Financial Institutions is taking less risk on the Individual or Company and thus will charge less Interest. Lower Credit Score means that the Bank of Financial Institutions is taking high risk on the Individual or Company and thus will charge higher Interest.
In order to determine how much less will be paid can be based on an assumption of how much the Credit Score has increased. In this case it would be 12.25%.
