Question

Nia wants to check whether the finance charge applied in her credit card statement is correct. To do this, she needs to calculate the average daily balance in her account for the previous billing cycle. She made a table to do the calculation. The billing cycle is 31 days. What was Nia's average daily balance in this billing cycle?

A) $513.42
B) $13.41
C) $5800.00
D) $5432.84

Answer 1

To calculate the average daily balance for the billing cycle, Nia needs to add up the balances for each day and divide by the number of days. Using the example in the question, the average daily balance is $674.19.

Step-by-step explanation:

To calculate the average daily balance in her account for the previous billing cycle, Nia needs to add up the balances of her account for each day of the billing cycle, and then divide the total by the number of days in the cycle. Let's say Nia's credit card statement shows her balance for each day of the billing cycle:

Day 1: $500
Day 2: $600
...
Day 31: $700

To calculate the average daily balance, she needs to add up all the balances and divide by 31 (the number of days in the billing cycle).

Average daily balance = (500 + 600 + ... + 700) / 31

After adding up all the balances:

Average daily balance = $20,900 / 31

Average daily balance = $674.19

So, Nia's average daily balance in this billing cycle was $674.19.