Question

A consumer charges a $46.92 purchase on a credit card. The card has a daily interest rate of 0.039%. If the consumer pays off the balance at the end of 30 days, how much in interest will be paid for the purchase?
a.
$0.06
b.
$0.18
c.
$0.55
d.
$5.49

Answer 1

Assuming that the interest is not compounding,
\[\color{green}{\text{Total cost} = \text{Initial purchase price} + \text{Interest}}\]
To calculate the interest:
\[\color{green}{\text{Interest} = \text{Initial purchase price} \times \frac{0.039}{100} \times 30}\]

Answer 2

So,
\[\color{green}{\text{Total cost} =46.92 + \big(46.92 \times \frac{0.039}{100} \times 30\big)}\]