Question

Suppose we have a card with an APR of 25%. The minimum payment is 7% of the balance. Suppose we have a balance of $350 on the credit card. We decide to stop charging and to pay it off by making the minimum payment each month.

Calculate the new balance after the first minimum payment is made.
Calculate the minimum payment that is due the next month.

Answer 1

Answer: Your welcome!

Explanation:

The new balance after the first minimum payment is made is $328.5. This is calculated by taking the balance of $350 and subtracting 7% of the balance, which is $24.50.

The minimum payment that is due the next month is $23.04. This is calculated by taking 7% of the new balance of $328.5.