compute the amount of interest that will be charged

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
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Use the average daily balance method to compute the amount of interest that will be charged at the end of the billing
cycle. Use a 365-day year.
Month: May (31 days)
Previous month's balance: $950
Interest rate: 20%
Date
May 3
May 12
May 21
May 29
Transaction
made payment of $350
purchase of $109
purchase of $88
made payment of $65
OA. $12.19
OB. $13.28
OC. $8.49
O D. $9.45
Transcribed Image Text:Use the average daily balance method to compute the amount of interest that will be charged at the end of the billing cycle. Use a 365-day year. Month: May (31 days) Previous month's balance: $950 Interest rate: 20% Date May 3 May 12 May 21 May 29 Transaction made payment of $350 purchase of $109 purchase of $88 made payment of $65 OA. $12.19 OB. $13.28 OC. $8.49 O D. $9.45
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