Question

The minimum monthly payment for Fern's credit card is 2.5% of her balance or $40, whichever is higher. If Fern's balance at the end of her last billing cycle was $1950, what is her minimum monthly payment?

A.$48.75
B.$40.00
C.$8.75
D.$88.75

Answer 1

1950 * .025
48.75
A
When you do these problems, you must make sure you put this percent into decimal form before punching it into your calculator.

Answer 2

A. $48.75.

Explanation:

We have been given that the minimum monthly payment for Fern's credit card is 2.5% of her balance or $40, whichever is higher.

First of all let us find 2.5% of $1950.

`\text{2.5\% of \$1950}=(2.5)/(100)* \$1950`

`\text{2.5\% of \$1950}=0.025* \$1950`

`\text{2.5\% of \$1950}=\$48.75`

Since the minimum monthly payment will be the higher amount among 2.5% of the balance or $40. As $48.75 is higher than $40, therefore, Fern's minimum monthly payment will be $48.75 and option A is the correct choice.