Question

. Your friend has 2 credit cards with balances that he cannot afford to pay off all at once. A $500 balanceon a card with 15.99% APR and a $400 card with a 25.99% APR.2. Calculate the monthly finance charges for each credit card. (round to the hundredths place)

Answer 1

`Monthly\text{ }finance=principal*(APR)/(12)`

A $500 balance on a card with 15.99% (0.1599) APR:

`\begin{gathered} Monthly\text{f}\imaginaryI nance=500*(0.1599)/(12) \\ \\ Monthly\text{f}\imaginaryI nance=6.66 \end{gathered}`

A $400 card with a 25.99% (0.2599)APR:

`\begin{gathered} Monthly\text{f}\mathrm{i}nance=400*(0.2599)/(12) \\ \\ Monthly\text{f}\mathrm{i}nance=8.66 \end{gathered}`

Then, the monthly finance charge is: $6.66 for first credit card and $8.66 for second credit card