Question

Dennis Rodman has a $5,000 debt balance on his Visa card that charges 10. 7 percent compounded monthly. Dennis's current minimum monthly payment is 5 perent of his debt balance, which is $250.

How many months (round up) will it take Dennis to pay off his credit card if he pays the current minimum payment of $250 at the end of each month?
How many months will it take Dennis to pay off his credit card?

Answer 1

Answer: 22.13 months

Step-by-step explanation:

The number of months that it will take Dennis to pay off his credit card will be calculated thus:

Balance amount = $5000

Monthly payment = $250

Interest rate = 10.7%/12 = 0.89%

The number of months will be:

= NPER(0.89, -250, 5000, 0).

= 22.13 months