Calvin Johnson has a $6,000 debt balance on his Visa card that charges 11.1 percent APR compounded monthly. In 2009, Calvin's minimum monthly payment is 4 percent of his debt balance, which is $240. How many months (round up) will it take Calvin Johnson to pay off his credit card if he pays the current minimum payment of $240 at the end of each month? In 2010, as the result of a federal mandate, the minimum monthly payment on credit cards rose to 5 percent. If Calvin made monthly payments of $300 at the end of each month, how long would it take to pay off his credit card?
Calvin Johnson has a $6,000 debt balance on his Visa card that charges 11.1 percent APR compounded monthly. In 2009, Calvin's minimum monthly payment is 4 percent of his debt balance, which is $240. How many months (round up) will it take Calvin Johnson to pay off his credit card if he pays the current minimum payment of $240 at the end of each month? In 2010, as the result of a federal mandate, the minimum monthly payment on credit cards rose to 5 percent. If Calvin made monthly payments of $300 at the end of each month, how long would it take to pay off his credit card?
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Question
Calvin Johnson has a
$6,000
debt balance on his Visa card that charges
11.1
percent APR compounded monthly. In 2009, Calvin's minimum monthly payment is
4
percent of his debt balance, which is
$240.
How many months (round up) will it take Calvin Johnson to pay off his credit card if he pays the current minimum payment of
$240
at the end of each month? In 2010, as the result of a federal mandate, the minimum monthly payment on credit cards rose to
5
percent. If Calvin made monthly payments of
$300
at the end of each month, how long would it take to pay off his credit card?
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