Mary's credit card situation is out of control because she cannot afford to make her monthly payments. She has thr redit cards with the following loan balances and APRS: Card 1, $4,500, 21%; Card 2, $5,700, 25%; and Card 3, 3,100, 19%. Interest compounds monthly on all loan balances. A credit card loan consolidation company has aptured Mary's attention by stating they can save Mary 16% per month on her credit card payments. This compan harges 16.5% APR. Is the company's claim correct? Assume a 10-year repayment period. Mary's current minimum monthly payments are $ (Round to the nearest cent.) Mary's minimum monthly payments after loan consolidation will be $. (Round to the nearest cent.) the company's claim correct? Choose the correct answer below. OA. Yes because Mary's monthly credit card payments will decrease for more than 16%. OB Yes because Mary's monthly credit card payments will increase for less than 16%
Mary's credit card situation is out of control because she cannot afford to make her monthly payments. She has thr redit cards with the following loan balances and APRS: Card 1, $4,500, 21%; Card 2, $5,700, 25%; and Card 3, 3,100, 19%. Interest compounds monthly on all loan balances. A credit card loan consolidation company has aptured Mary's attention by stating they can save Mary 16% per month on her credit card payments. This compan harges 16.5% APR. Is the company's claim correct? Assume a 10-year repayment period. Mary's current minimum monthly payments are $ (Round to the nearest cent.) Mary's minimum monthly payments after loan consolidation will be $. (Round to the nearest cent.) the company's claim correct? Choose the correct answer below. OA. Yes because Mary's monthly credit card payments will decrease for more than 16%. OB Yes because Mary's monthly credit card payments will increase for less than 16%
Chapter6: Business Expenses
Section: Chapter Questions
Problem 89TPC
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Transcribed Image Text:Mary's credit card situation is out of control because she cannot afford to make her monthly payments. She has three
credit cards with the following loan balances and APRs: Card 1, $4,500, 21%; Card 2, $5,700, 25%; and Card 3,
$3,100, 19%. Interest compounds monthly on all loan balances. A credit card loan consolidation company has
captured Mary's attention by stating they can save Mary 16% per month on her credit card payments. This company
charges 16.5% APR. Is the company's claim correct? Assume a 10-year repayment period.
Mary's current minimum monthly payments are $
(Round to the nearest cent.)
Mary's minimum monthly payments after loan consolidation will be $ . (Round to the nearest cent.)
Is the company's claim correct? Choose the correct answer below.
O A. Yes because Mary's monthly credit card payments will decrease for more than 16%.
O B. Yes because Mary's monthly credit card payments will increase for less than 16%.
C. No because Mary's monthly credit card payments will increase for more than 16%.
O D. No because Mary's monthly credit card payments will decrease for less than 16%.
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