It will take Jerrod 4 Years and 2 months to get his balance on his credit card $4000
In this question, it is stated that Jerrod owes $2000 on a credit card that charges him an Annual interest of 18%. If he stops making payments we have to find out how much time will it take for Jerrod to get his credit card balance to $4000.
Taking the annual interest rate of 18%,
first year's due payment will be => 2000 + (18*2000)/100 = $2360
Similarly, second year's due payment => 2360 + (18*2360)/100 = $2784.80
third year, the due payment will be => 2784.80 + (18*2784.80)/100 = $3286
Forth year, due payment => 3286 + (18*3286)/100 = 3877.48
At the beginning of the fifth year approximately 2 months the due payment will reach $4000.
Hence, it will take 4 years and 2 months for the amount to reach $4000.
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