Question

Brad has an outstanding balance of $185.68 on his credit cardaccount. What is the finance charge for the month if it iscalculated at 1.8%per month.a. $219.10b. $3.34c. $188.47d. $33.42

Answer 1

Answer:

B. $3.34

Explanation:

Given;

Outstanding balance = $185.68

Monthly interest rate in decimal = 1.8% = 1.8/100 = 0.018

We can go ahead and determine the finance charge using the below formula;

$\begin{gathered} \text{ Finance charge }=\text{ Outstanding balance x Monthly interest rate} \\ \text{Finance charge }=185.68\times0.018=\text{ \ 3.34} \\ \end{gathered}$