Question

Suppose your credit card balance is ​$15500 . The minimum payment is ​$319​, and the annual percentage rate is 20.1​%.

a.  If you make a constant monthly payment of ​$319​, how long will it take you to pay off the credit card​ balance?

b.  How much interest will you pay if you elect to make the minimum​ payment?

Please use Excel to solve and show all formulas.

Answer 1

F 265 266 267 268 Calculation of periods in months PV (Credit card 15500 1/12= 20.1%/12= 1.6750% PMT= -$319.00 $0.00 NPER Excel fun Nper(l/y, PMT, PV, FV) NPER =(nper(F267, F268, F266, F269)) 1951SN FV= 269 270 271 272 273 NPER is no of periods upto which amount will last that is 101.22 months. 274 Interest paid= (N $16,787.75 275 276 277 278 279 280 281 282 283 284 285 286 287 288 289 290 =(nper(F267, F268, F266, F269))

265 266 267 268 Calculation of periods in months PV (Credit card 15500 1/12= 20.1%/12= 1.6750% PMT= -$319.00 FV= $0.00 NPER Excel fun Nper(l/y, PMT, PV, FV) NPER 101.215516 269 270 271 272 NPER is no of periods upto which amount will last that is 101.22 months. 273 274 275 Interest paid= (N =(F271*-F268)-F266 276 277 278 279 280 281 282 283 284 285 286 287 288 289 290 fx =(F271*-F268)-F266