The quoted annual rate on your credit card is 14 percent, and there is a $30 annual fee. If your account balance for the monthly billing period is $1,000, what is your finance charge for the month? O $41.67 O $11.67 O $140 O $12.02

The quoted annual rate on your credit card is 14 percent, and there is a $30 annual fee. If your account balance for the monthly billing period is $1,000, what is your finance charge for the month? O $41.67 O $11.67 O $140 O $12.02

Pfin (with Mindtap, 1 Term Printed Access Card) (mindtap Course List)

7th Edition

ISBN:9780357033609

Author:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk

Publisher:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk

Chapter6: Using Credit

Section: Chapter Questions

Problem 8FPE

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Concept explainers

Effective Interest Rate

The term interest rate can be defined as the amount that is charged by the lender as a percentage on the principal amount. Interest rate which is charged annually is known as annual percentage rate.

Question

The quoted annual rate on your credit card is 14 percent, and there is a
$30 annual fee. If your account balance for the monthly billing period
is $1,000, what is your finance charge for the month?
$41.67
$11.67
$140
$12.02

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