Paying off credit cards Simon recently received a credit card with an 13% nomina

Question

Paying off credit cards Simon recently received a credit card with an 13% nominal interest rate, with on the card is only $10 per month. the card, he purchased an Apple iPhone 5 for $420. The minimum payment makes the minimum monthly payment and makes no other charges, how many months ill it be before he pays off the card? Round your answer to the nearest whole. month(s) b. If Simon makes monthly payments of $30, how many months will it be before he pays off the debt? Round your answer to the nearest whole month(s) c. How much more in total payments will Simon make under the $10-a-month plan than under the $30-a-month plan. Make sure you use 3 decimal places for N. Round your answer to the nearest cent.

Explanation / Answer

Solution - a:

Therefore it will take 57 months to Simon to pays off the card.

Solution - b:

Therefore it will take 16 months to Simon to pays off the card.

Solution - c:

Total payment under $10-a-month plan = $563.32

Total payment under $30-a-month plan = $457.98

Excess payment under $10-a-month plan = $563.32 - $457.98 = $105.34

Payment Schdule Credit Card - $10 per month Month Opening Balance Interest Payment Closing Balance 1 $420.00 $4.55 $10.00 $414.55 2 $414.55 $4.49 $10.00 $409.04 3 $409.04 $4.43 $10.00 $403.47 4 $403.47 $4.37 $10.00 $397.84 5 $397.84 $4.31 $10.00 $392.15 6 $392.15 $4.25 $10.00 $386.40 7 $386.40 $4.19 $10.00 $380.59 8 $380.59 $4.12 $10.00 $374.71 9 $374.71 $4.06 $10.00 $368.77 10 $368.77 $4.00 $10.00 $362.76 11 $362.76 $3.93 $10.00 $356.69 12 $356.69 $3.86 $10.00 $350.56 13 $350.56 $3.80 $10.00 $344.36 14 $344.36 $3.73 $10.00 $338.09 15 $338.09 $3.66 $10.00 $331.75 16 $331.75 $3.59 $10.00 $325.34 17 $325.34 $3.52 $10.00 $318.87 18 $318.87 $3.45 $10.00 $312.32 19 $312.32 $3.38 $10.00 $305.71 20 $305.71 $3.31 $10.00 $299.02 21 $299.02 $3.24 $10.00 $292.26 22 $292.26 $3.17 $10.00 $285.42 23 $285.42 $3.09 $10.00 $278.52 24 $278.52 $3.02 $10.00 $271.53 25 $271.53 $2.94 $10.00 $264.47 26 $264.47 $2.87 $10.00 $257.34 27 $257.34 $2.79 $10.00 $250.13 28 $250.13 $2.71 $10.00 $242.84 29 $242.84 $2.63 $10.00 $235.47 30 $235.47 $2.55 $10.00 $228.02 31 $228.02 $2.47 $10.00 $220.49 32 $220.49 $2.39 $10.00 $212.88 33 $212.88 $2.31 $10.00 $205.18 34 $205.18 $2.22 $10.00 $197.41 35 $197.41 $2.14 $10.00 $189.55 36 $189.55 $2.05 $10.00 $181.60 37 $181.60 $1.97 $10.00 $173.57 38 $173.57 $1.88 $10.00 $165.45 39 $165.45 $1.79 $10.00 $157.24 40 $157.24 $1.70 $10.00 $148.94 41 $148.94 $1.61 $10.00 $140.56 42 $140.56 $1.52 $10.00 $132.08 43 $132.08 $1.43 $10.00 $123.51 44 $123.51 $1.34 $10.00 $114.85 45 $114.85 $1.24 $10.00 $106.09 46 $106.09 $1.15 $10.00 $97.24 47 $97.24 $1.05 $10.00 $88.29 48 $88.29 $0.96 $10.00 $79.25 49 $79.25 $0.86 $10.00 $70.11 50 $70.11 $0.76 $10.00 $60.87 51 $60.87 $0.66 $10.00 $51.53 52 $51.53 $0.56 $10.00 $42.09 53 $42.09 $0.46 $10.00 $32.54 54 $32.54 $0.35 $10.00 $22.89 55 $22.89 $0.25 $10.00 $13.14 56 $13.14 $0.14 $10.00 $3.29 57 $3.29 $0.04 $3.32 $0.00 Total $563.32

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