Answer:
$793.70
Explanation:
The computation is shown below:
At introductory rate
The rate is 17.8% per year
And, in monthly, the rate would be
= 1.25% ÷ 12 months
= 1.4833%
Time is 6 months
Amount after 6 month would be
= Balance × (1 + interest rate)^ time period
= $8,000 × (1 + 0.1042%)^6
= $8,050.15
The interest after 6 month is
= $8,050.15 - $8,000
= $50.15
Now for increase rate to 17.8%
The rate is 17.8% per year
And, in monthly, the rate would be
= 17.8% ÷ 12 months
= 1.4833%
Time is 6 months
Amount after 6 month would be
= Balance × (1 + interest rate)^ time period
= $8,050.14 × (1 + 1.4833%)^6
= $8,793.70
The interest after 6 month is
= $8793.70 - $8,050.15
= $743.55
So, the total interest would be
= $50.15 + $743.55
= $793.70
