Question

You have just graduated from college and purchased a car for $8000. Your credit limit is $11,000. Assume that you make no payments and purchase nothing more and that there are no other fees. The monthly interest rate is 2%. What is your initial credit card balance?

Answer 1

assume the graduate put the purchase on his card.
then
Initial balance = $8000 on the first statement (+fees and interest charges, if any)
That means he owes the card issuer $8000.
Credit balance is what the issuer owes the card holder, which is zero.

Answer 2

You have just graduated from college and purchased a car for $8000. Your credit limit is $11,000. thus, the initial credit card balance is the issuer owes the cardholder, which is zero.

What is banker's rule for calculating simple interest?

In this, we assume that each year is of 360 days, and each month of such year have equal days, which is 360/12 = 30 days.

You have just graduated from college and purchased a car for $8000. Your credit limit is $11,000.

Assume that you make no payments and purchase nothing more and that there are no other fees.

The monthly interest rate is 2%.

Initial balance = $8000 on the first statement

including fees and interest charges.

That means he owes the card issuer $8000.

The credit balance is the issuer owes the cardholder, which is zero.

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