Question

Megan uses a credit card with a 24.9% APR compounded monthly to pay for car repairs totaling $583.75. She can pay $240 per month on the card. What will the total cost of this purchase be

Answer 1

the correct answer is $605.80

Answer 2

It is convenient to use a spreadsheet to compute the finance charge and the new balance each month. The graphic here shows the beginning balance and finance charge for each of the 3 months it will take Megan to pay off the purchase.

Her total expense is $605.80.