Final answer:
If a credit card payment is not renewed by December 31st, there will be a fine for not renewing on time. The fine is calculated based on the number of days the payment remains unpaid. Option (D) is correct.
Step-by-step explanation:
If you do not renew your credit card payment by December 31st, you can be fined for not renewing on time. The credit card company charges $10 when a payment is late and an additional $5 per day for each day the payment remains unpaid. If we assume that you did not renew your payment from January 1st to February 15th, which is a total of 46 days, you would be fined $230 ($5 x 46). So, the correct option is D) $30.
A late fee is a charge imposed on a consumer who fails to make the payment on a debt or other financial obligation by the due date. All late fees must be explicitly outlined to borrowers and must also be reasonable. Late fees generally range from $25 to $50.
These fees serve multiple purposes: they compensate for the financial stress and administrative burden caused by late payments, encourage customers to pay on time, and allow businesses to manage their cash flow more effectively.