Question

Terry has a credit card that uses the average daily balance method. For the first 18 days of one of his billing cycles, his balance was $350, and for the last 12 days of the billing cycle, his balance was $520. If his credit card's APR is 14%, which of these expressions could be used to calculate the amount Terry was charge in interest for the billing cycle?

A.(0.14/365*31)(18*$350+12*$520/31)

B.(0.14/365*30)(12*$350+18*520/30)

C.(0.14/365*31)(12*$350+18*$520/31)

D.(0.14/365*30)(18*$350+12*$520/30)

PLEASE HELP!! I can never figure these out so if you do help can you please explain how you did it?

Answer 1

Okay, as we can see here it'd be 14% because of the interest which convert's into 0.14 as a decimal and then divided by 365 because of the days in a year

Then, you would divide by 30 because it says the first 18 days and the last 12 days which adds up to 30.

Next, you would do 18 times $350 because that's how much he was charged in the 1st 18 days.

After that, you would add it to the last 12 days which he would be charged $520 and then divided by 30 again because that's how much days are in a month.

This leaves us with option D so that is what we would choose.

Answer 2

THANK YOU SO MUCH!! Maybe now I'll be able to figure out the rest of those