Question

You owe $1,945.61 on a credit card that has an 11.2% APR. The minimum payment due is $156.00. You decide to pay $300.00. How much do you save in interest after one month by paying more than the minimum, assuming you make both payments at the beginning of the month?

Answer 1

We are given
P = $1,945.61
r = 11.2%
Amin = $156
A = $300

First, we convert the interest to effective monthly terms
i = 11.2%/12 = 0.933%

After one month, the interest saved by paying more than the minimum is
(0.00933) (300 - 156) = $1.35

Answer 2

Answer:

You were off by 1 point it's $1.34, but thank you for explaining and showing your work