Question

Jose wants to pay off his credit card balances within 18 months. He is trying to decide if he should use his $1,750 in

savings to pay off part of the balances or if he should transfer the balances to a new card with a low introductory
rate. The new credit card has an introductory rate of 8% but charges a balance transfer fee of $60 for each balance
transfer. Jose decides to pay off Credit Card B using his savings and then transfer the balance of Card A to the new
card. Which of the following options shows the amount of Jose's new monthly payment?
Credit Card A: $1,154
Credit Card B $1,469
a
b
$90.43
$68.25
$71 80
$75.34
С
d
Please select the best answer from the choices provided.
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Answer 1

The new monthly payment for Jose would be $0.

Step-by-step explanation:

To find the amount of Jose's new monthly payment, we need to calculate the balances and interest rates. First, he pays off the balance of Credit Card B using his savings of $1,750. Then, he transfers the balance of Credit Card A to the new card with a low introductory rate of 8%.

Let's calculate the new balance of Credit Card A after 18 months:

Original balance of Credit Card A = $1,154

Interest rate per month = (APR / 12) = (19.9% / 12) = 1.66%

New balance of Credit Card A after 18 months = Original balance + (Original balance * Interest rate * Number of months) = $1,154 + ($1,154 * 1.66% * 18) = $1,461.64

Now, let's calculate the new monthly payment:

Monthly payment = New balance / Number of months = $1,461.64 / 18 = $81.20

However, since Jose paid off part of the balance with his savings, the new monthly payment would be:

New monthly payment = Monthly payment - Savings used = $81.20 - $1,750 = -$1,668.80

Since the monthly payment cannot be negative, the correct answer is $0.

Answer 2

c.$71.80

Step-by-step explanation:

did the debt management quiz