You owe $15,000 in credit card debt and today is the end of the billing cycle fo

Question

You owe $15,000 in credit card debt and today is the end of the billing cycle for your credit card. Your credit card has an APR of 18% and payments are calculated as 2% of outstanding balance or $15, whichever is greater. Show work in excel using the template below. Determine: How many years will it take to pay the entire amount assuming you only make the minimum payments? At what month does the payment hit the $15 minimum? What is the total amount paid? What is the total amount of interest paid?

Explanation / Answer

Answer:

a) 199 years

b) 148 years

c) 15011

d) 131693

BB 15000 APR 18% Payment Greater of 2% or $15 n BB Interest Payment EB 0 15000 15000 1 15000 2700 300 14700 2 14700 2646 294 14406 3 14406 2593 288 14118 4 14118 2541 282 13836 5 13836 2490 277 13559 6 13559 2441 271 13288 7 13288 2392 266 13022 8 13022 2344 260 12761 9 12761 2297 255 12506 10 12506 2251 250 12256 11 12256 2206 245 12011 12 12011 2162 240 11771 13 11771 2119 235 11535 14 11535 2076 231 11305 15 11305 2035 226 11079 16 11079 1994 222 10857 17 10857 1954 217 10640 18 10640 1915 213 10427 19 10427 1877 209 10218 20 10218 1839 204 10014 21 10014 1803 200 9814 22 9814 1766 196 9618 23 9618 1731 192 9425 24 9425 1697 189 9237 25 9237 1663 185 9052 26 9052 1629 181 8871 27 8871 1597 177 8694 28 8694 1565 174 8520 29 8520 1534 170 8349 30 8349 1503 167 8182 31 8182 1473 164 8019 32 8019 1443 160 7858 33 7858 1414 157 7701 34 7701 1386 154 7547 35 7547 1358 151 7396 36 7396 1331 148 7248 37 7248 1305 145 7103 38 7103 1279 142 6961 39 6961 1253 139 6822 40 6822 1228 136 6686 41 6686 1203 134 6552 42 6552 1179 131 6421 43 6421 1156 128 6292 44 6292 1133 126 6166 45 6166 1110 123 6043 46 6043 1088 121 5922 47 5922 1066 118 5804 48 5804 1045 116 5688 49 5688 1024 114 5574 50 5574 1003 111 5463 51 5463 983 109 5353 52 5353 964 107 5246 53 5246 944 105 5141 54 5141 925 103 5038 55 5038 907 101 4938 56 4938 889 99 4839 57 4839 871 97 4742 58 4742 854 95 4647 59 4647 837 93 4554 60 4554 820 91 4463 61 4463 803 89 4374 62 4374 787 87 4287 63 4287 772 86 4201 64 4201 756 84 4117 65 4117 741 82 4034 66 4034 726 81 3954 67 3954 712 79 3875 68 3875 697 77 3797 69 3797 683 76 3721 70 3721 670 74 3647 71 3647 656 73 3574 72 3574 643 71 3502 73 3502 630 70 3432 74 3432 618 69 3364 75 3364 605 67 3296 76 3296 593 66 3231 77 3231 581 65 3166 78 3166 570 63 3103 79 3103 558 62 3041 80 3041 547 61 2980 81 2980 536 60 2920 82 2920 526 58 2862 83 2862 515 57 2805 84 2805 505 56 2748 85 2748 495 55 2693 86 2693 485 54 2640 87 2640 475 53 2587 88 2587 466 52 2535 89 2535 456 51 2484 90 2484 447 50 2435 91 2435 438 49 2386 92 2386 429 48 2338 93 2338 421 47 2291 94 2291 412 46 2246 95 2246 404 45 2201 96 2201 396 44 2157 97 2157 388 43 2114 98 2114 380 42 2071 99 2071 373 41 2030 100 2030 365 41 1989 101 1989 358 40 1950 102 1950 351 39 1911 103 1911 344 38 1872 104 1872 337 37 1835 105 1835 330 37 1798 106 1798 324 36 1762 107 1762 317 35 1727 108 1727 311 35 1692 109 1692 305 34 1659 110 1659 299 33 1625 111 1625 293 33 1593 112 1593 287 32 1561 113 1561 281 31 1530 114 1530 275 31 1499 115 1499 270 30 1469 116 1469 264 29 1440 117 1440 259 29 1411 118 1411 254 28 1383 119 1383 249 28 1355 120 1355 244 27 1328 121 1328 239 27 1302 122 1302 234 26 1275 123 1275 230 26 1250 124 1250 225 25 1225 125 1225 220 24 1200 126 1200 216 24 1176 127 1176 212 24 1153 128 1153 208 23 1130 129 1130 203 23 1107 130 1107 199 22 1085 131 1085 195 22 1063 132 1063 191 21 1042 133 1042 188 21 1021 134 1021 184 20 1001 135 1001 180 20 981 136 981 177 20 961 137 961 173 19 942 138 942 170 19 923 139 923 166 18 905 140 905 163 18 887 141 887 160 18 869 142 869 156 17 852 143 852 153 17 834 144 834 150 17 818 145 818 147 16 801 146 801 144 16 785 147 785 141 16 770 148 770 139 15 754 149 754 136 15 739 150 739 133 15 724 151 724 130 15 709 152 709 128 15 694 153 694 125 15 679 154 679 122 15 664 155 664 120 15 649 156 649 117 15 634 157 634 114 15 619 158 619 111 15 604 159 604 109 15 589 160 589 106 15 574 161 574 103 15 559 162 559 101 15 544 163 544 98 15 529 164 529 95 15 514 165 514 93 15 499 166 499 90 15 484 167 484 87 15 469 168 469 84 15 454 169 454 82 15 439 170 439 79 15 424 171 424 76 15 409 172 409 74 15 394 173 394 71 15 379 174 379 68 15 364 175 364 66 15 349 176 349 63 15 334 177 334 60 15 319 178 319 57 15 304 179 304 55 15 289 180 289 52 15 274 181 274 49 15 259 182 259 47 15 244 183 244 44 15 229 184 229 41 15 214 185 214 39 15 199 186 199 36 15 184 187 184 33 15 169 188 169 30 15 154 189 154 28 15 139 190 139 25 15 124 191 124 22 15 109 192 109 20 15 94 193 94 17 15 79 194 79 14 15 64 195 64 12 15 49 196 49 9 15 34 197 34 6 15 19 198 19 3 15 4 199 4 1 15 -11

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