Question

Jenny has recently begun keeping her spending under better control, but she

still can't fully pay off her credit card. She maintains an average monthly
balance of about $1100, and her card charges a 24% annual interest rate,
which it bills at a rate of 2% per month.
How much is she spending on credit card interest per year?

Answer 1

$264

Explanation:

You want to know Jenny's annual finance charges if her credit card balance averages $1100 and her interest rate is 24%.

Annual interest charge

The annual interest charge will be the product of the annual interest rate and the average balance over the course of the year.

24% × $1100 = $264

Jenny spends about $264 per year on credit card interest.