Question

Assume that you start with a balance of $4000 on your MasterCard. Assume that MasterCard has finance charges of 16% APR and that each month you make only the minimum payment of 4% of the balance. During the first month, you charge $250, and during the second month, you charge $500. Complete the following table. (Round your answers to the nearest cent.) Minimum payment Purchases New balance Previous balance $4000.00 Finance charge $ 53.17 ✓ $250 " Month 1 Month 2 $ $ 160 $ " eBook

Answer 1

	Previous balance	Payment	Purchases	Finance charge	new balance
Month 1	4000	160	250	54.53	4144.53
month 2	4144.53	165.78	500	59.72	4538.47

Workings:

Finance charge will be 16%/12 on (Previous balance-Payment+Charges)

new balance will include the finance charges.

AutoSave © of HO- Book1 - Excel Sign in - o X File Home Insert Draw Page Layout Formulas Data Review View Help O Tell me what you want to do Share Comments = = open alle Calibri BI U - 11 - - A À = - A - E General $ - % Insert Delete - Format 2' AZ O T- - Sort & Find & Filter - Select Paste - Conditional Format as Formatting Table Cell Styles Clipboard Font Alignment Number Styles Cells Editing C15 А. в с C D E F 10 2 Previous balance Payment Purchases Finance charge new balance Month 1 4000 =C13*4% 250 =(C13-D13+E13)*16%/12 =C13-D13+E13+F13 month 2 =G13 =C14*4% 500 =(C14-D14+E14)*16%/12 =C14-D14+E14+F14 14 16 17 18 19 24 25.