Question

Use PMT=

PA
to determine the regular payment amount, rounded to the nearest dollar. Your credit card has a
nt
balance of $3000 and an annual interest rate of 16%. You decide to pay off the balance over four years. If there are no further
purchases charged to the card,
U much munt unu nenach month?
a. The monthly payments are approximately $
(Do not round until the final answer. Then round to the nearest dollar as needed.)

Answer 1

Given the credit card balance of $3000, an annual interest rate of 16%, and a payment period of four years, the monthly payment amount is approximately $63.

Step-by-step explanation:

To calculate the regular payment amount on a credit card balance, we can use the PMT function in Excel or a financial calculator.

The formula for the monthly payment amount is: PMT = PA / n.

Given that the credit card balance is $3000, the annual interest rate is 16%, and the payment period is four years, we can plug in the values to the formula to calculate the monthly payment amount.

PMT = 3000 / (4 * 12) [since there are 12 months in a year]

Simplifying the equation, we get PMT

= 3000 / 48

= $62.50.

Therefore, the monthly payment amount, rounded to the nearest dollar, is approximately $63.