Suppose that you charged $8430 on a credit card to relocate for your first job. When you realized that the interest rate for the unpaid balance was 27% compounded monthly, he decided not to charge any more on that account. You want to have this account paid off by the end of 3 years, so you arrange to have automatic payments of equal amount sent at the end of each month. (a) What monthly payment must you make to have the account paid off by the end of 3 years? (b) How much total interest will you have paid?
Suppose that you charged $8430 on a credit card to relocate for your first job. When you realized that the interest rate for the unpaid balance was 27% compounded monthly, he decided not to charge any more on that account. You want to have this account paid off by the end of 3 years, so you arrange to have automatic payments of equal amount sent at the end of each month. (a) What monthly payment must you make to have the account paid off by the end of 3 years? (b) How much total interest will you have paid?
Chapter5: The Time Value Of Money
Section: Chapter Questions
Problem 24P
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Suppose that you charged $8430 on a credit card to relocate for your first job. When you realized that the interest rate for the unpaid balance was 27% compounded monthly, he decided not to charge any more on that account. You want to have this account paid off by the end of 3 years, so you arrange to have automatic payments of equal amount sent at the end of each month.
(a) What monthly payment must you make to have the account paid off by the end of 3 years?
(b) How much total interest will you have paid?
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