he applicable interest rate would begin at 9% (8% + 1%) and remain there for 60 days. Then the applicable rate would rise to 10% (9% + 1%) for the next 30 days and then to 10.50% (10% + 0.50%) for the next 60 days. Finally

the applicable rate would drop to 9.50% (10.50% − 1%) for the final 30 days.Total interest cost over 180 daysBecause the estimated total interest cost on the variable-rate loan of $1