Question

explain the diagram in detail ( explain the steps on whats going on )

1 Discrete Dynamical Systems balance Interest au Annual Interest Rate Annual In Monthly Interest Rate FIGURE 1.24 Credit Card Compartmental Diagram

Answer 1

Dynamical systems are about the evolution of some quantities over time. This evolution can occur smoothly over time or in discrete time steps. Here, we introduce dynamical systems where the state of the system evolves in discrete time steps, i.e., discrete dynamical systems.

When we model a system as a discrete dynamical system, we imagine that we take a snapshot of the system at a sequence of times. The snapshots could occur once a year, once every millisecond, or even irregularly.

The picture shows that the credit card has remaining limit of X amount and Y% of yearly interest is applied on it. When any payment does not made to credit card for an year so some more interest will be applied on it. Which is calculated on the basis of compounding interest method.

When interest is charged on monthly basis on the annual interest amount. This will generate the compound interest (As shown in picture as interest) and same will be applied to the credit card used amount which is your payable amount.

A. Annual interest is charged on credit card.

B. Interest payment not made on the basis of compounding interest rate method monthly interest is charged.

C. Sum of annual interest and monthly interest is applied.

D. Interest applied on credit card bill payment.