Question

A certain credit card company charges 1 1/2 % interest per month on the unpaid balance . if Joni has an unpaid balance of $300 and does not pay her bill for two months, how much interest will she be charged for the second month????

Answer 1

The interest for the second month will be $4.5675 or $4.57

Unpaid balance is $300
Interest rate per month is 1 1/2% or 1.5% or 0.015

First month: $300 * 1.5% = $4.50 - interest on the first month.

Since she did not pay for 2 months, the interest charged to her account in the first month will be added to her unpaid balance increasing it to $304.50. This will be the basis of the second months' interest charge.

Second month: $304.50 * 1.5% = $4.5675 or rounded off to $4.57

Total interest charged for the unpaid balance of $300 is $9.07 (4.5 + 4.57)