 Cost of delay

Cost of Delay is the cost to bear as a result of delay in investment. Any delay in making an investment leads to a cost/loss. The accrued interest on the investment for the duration of the delay has a significant effect on the net returns. The cost grows with the period of the investment; longer the investment more is the cost.
In simpler words, Cost of Delay is the cost as a result of delay in investment.
Real World Example
Alberto is planning to invest 6,000.00 USD since last 8 months. He needs the money after 5 years. He is expecting an interest rate of 10.00 % compounded annually.
Investment
Amount Period Interest Rate Compounding Delay Period 6,000.00 USD 5 Year 10.00 % Annually 8 Month Returns
Interest Accrued Maturity Amount 3,068.17 USD 9,068.17 USD See also
 Rate of return on investment
 Finance
 Interest
 Real interest rate
 Single deposit
 Periodic deposit
Categories: Finance
 Economics and finance stubs
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