Question

Jeremy didn't pay his previous month's credit card bill in full. This month's bill shows a finance charge of $85.50. Jeremy calculates the average daily balance in the new bill to be $5,343.75 What is the monthly Pentage rate on the card?

A 1.6%

B. 1.92%

C 16%

D. 19.2%

Answer 1

The monthly percentage rate would be 1.6%

Explanation:

Given,

Finance charge = $ 85.50,

Amount of bill in this month = $ 5,343.75,

Hence, the monthly rate of percentage

`=\frac{\text{Finance charge}}{\text{Amount of bill}}* 100`

`=(85.5)/(5343.75)* 100`

`=(8550)/(5343.75)`

`=(855000)/(534375)`

= 1.6 %

i.e. OPTION A would be correct.