Question

Maxine's credit card has an APR of 21.99%. If her current monthly balance, before interest, is $2,586.50, what will her monthly interest charge be?

a) $17.62
b) $47.39
c) $47.40
d) $117.62

Answer 1

Maxine's monthly interest charge will be $47.39

Step-by-step explanation:

To calculate Maxine's monthly interest charge, we can use the formula:

Interest Charge = Balance × (Annual Interest Rate ÷ 12)

Plugging in the values, we get:

Interest Charge = $2,586.50 × (21.99% ÷ 12)

Simplifying the equation, we get:

Interest Charge = $2,586.50 × 0.0183

Calculating the result, we find:

Interest Charge = $47.39

Therefore, Maxine's monthly interest charge will be $47.39, and the correct answer is b) $47.39.