18
QuizMultiple Choice

Managing Credit and Debit — Test

Question 18 • Personal Finance

The table shows a schedule of Mr. Kirov’s plan for paying off his credit card balance. Mr. Kirov’s Payment Plan Balance Payment New Balance Rate Interest 800 point 0 0 dollars 100 dollars 700 point 0 0 dollars 0 point 0 1 2 8 point 4 0 dollars 708 point 4 0 dollars 100 dollars 608 point 4 0 dollars 0 point 0 1 2 7 point 3 0 dollars 615 point 7 0 dollars 100 dollars 515 point 7 0 dollars 0 point 0 1 2 6 point 1 9 dollars If Mr. Kirov continues to make monthly payments of 100 dollars and does not make any new purchases, how many more payments will he need to make before the balance is 0 ?

Answer
A
7 payments
B
4 payments
C
6 payments
D
5 payments

Explanation

After the last row shown, the balance is $515.70 plus $6.19 interest, or $521.89. Each $100 payment reduces the balance, and then 1.2% interest is added to what remains. After five more payments, the balance is still about $35.72, so he needs one final payment to clear it. That makes 6 more payments total, so the correct choice is 6 payments.

AI-written and checked against the verified answer.

Previous
Next