Question

Timothy Carter went out to eat with his girlfriend at a fancy restaurant. When he tried to pay the bill with his Mastercard credit card, he was told that the restaurant accepted only cash or American Express. His waiter suggested that he use the ATM across the street to withdraw cash using his credit card. Tim did as suggested and didn't pay attention to any fees until he received his credit card statement one month later. He was shocked to see the total fees (2.0% cash advance), and his APR was increased to 21.5%. Given the cost of the meal ($190) plus the associated fees, how much did his meal cost him? Multiple Choice o $197.20 o O $190.00 o O $3.80 5 $3.40

Answer 1

The answer is Option $ 197.2. Cost of the Meal is $ 197.2

Basic Cost of Meal is $ 190

Add 2% Cash Advance Fees on $ 190 = $ 3.8

Add APR is 21.5% for one month on $ 190 = $ 3.4

Hence Totals = $ 197.2