Question

Larry uses his credit card to purchase a new video game system for $445.07. He can pay off up to $200 per month. The card has an annual rate of 13.6% compounded monthly. How much total interest will he pay?

$8.47

$10.21

$53.54

$3.32

Answer 1

Assume Larry pays off $200 each month.
The interest at the end of month 1 is
\[445.07\times \frac{0.136}{12}=$\ can\ you\ calculate?\]

Answer 2

@Fenetre135 Are you there?

Answer 3

yeah just give me a sec :)

Answer 4

5.04?

Answer 5

Good work!
The balance at the end of the first month after adding interest and subtracting the payment is
\[445.07+5.04-200=you\ can\ calculate\]

Answer 6

250.11

Answer 7

Correct again!
The interest at the end of the second month is
\[250.11\times \frac{0.136}{12}=$\ ?\]

Answer 8

2.83

Answer 9

Good! The balance at the end of the second month after adding interest and subtracting the payment is
\[250.11+2.83-200=$\ ?\]

Answer 10

52.94

Answer 11

Good! We are heading to one of the choices.
The interest at the end of the third month is
\[52.94\times \frac{0.136}{12}=$\ x\] When you have found the value of x do the following addition to find the total interest
\[$5.04+$2.83+$\ x=$\ you\ can\ calculate\]

Answer 12

8.469

Answer 13

thank you for your help!

Answer 14

So the correct choice is $8.47.
You're welcome :)