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lara31 [8.8K]
3 years ago
10

You have a credit card with a balance of $1,187.92 and the interest is 12.25% APR. A late fee of $30.00 is charged for payments

after the due date. You missed your payment due date, but plan to make a payment of $125.00 on the next due date. What will be the new principal after that payment?
A) $1,242.39
B) $1,105.05
C) $1,117.61
D) $1,062.92
Mathematics
1 answer:
harkovskaia [24]3 years ago
8 0

Answer:

C)$1,117.61

Step-by-step explanation:

The balance on the credit card is $1187.92 with interest of 12.25%.

r = 12.25% = 12.25/100 = 0.1225

A late fee = $30

Amount = P(1 + r/12)^1 + late fee

Now plug in the given values in to the formula, we get

1187.92 (1 + 0.1225/12) + 30

= 1200.05 + 30

= $1230.05

During the next due date, you pay $125, so the new balance

1230.05 (1 + 0.1225/12) - 125

= $1117.61

Thank you.


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To rationalize that kind of expressions, this is to eliminate the radicals on the denominator you use conjugate rationalization.

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To help you with the solution of that expression, I will show each part.

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