Suppose that Kathy uses her credit card to cover her expenses and pay her bills. She accumulates a balance of $12,500 at an annu
al interest rate of 21%. Determine the future value of the total amount she will have to repay, if she takes 6 years to pay it off. Briefly, explain how excessive credit usage can’t lead into financial burden or default on your loans. (Show your work)
Thus, Kathy have to repay $39,230.35 at the end of 6 years.
Excessive credit usage would not lead to default on your loans because credit card companies offer loan when you maintain a healthy balance sheet which means you maintain a specific amount in your account always which can repay the loan easily. Keeping extra money in your account reduce the probability that customers default on loans.
A trust created while a person is still alive is called a Living Trust. The Living Trust is created when one person, a Grantor, places property into the trust.
