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Marginal Cost Of Funds. The incremental cost of borrowing more money to fund additional asset purchases or investments. In its simplest calculation, the marginal cost of funds is simply the interest rate on the new loan balance.
borrowing cost. The total charge for taking on a debt obligation that can involve interest payments and other financing fees. The borrowing cost for a business tends to go up when prevailing market interest rates are rising during times of economic expansion and increased inflation, even if its credit standing remains excellent.