Question

Your credit card charges an interest rate of 2% per month. You have a current balance of $1000, and want to pay it off. Suppose you can afford to pay off $100 per month. What will your balance be at the end of one year

Answer 1

Answer:

$2,609.45

Explanation:

For this question we have to find out the future value which is shown below:

Data provided in the question

Present value = $1,000

Rate of interest = 2%

NPER = 12 months

PMT = $150

The formula is shown below:

= -FV(Rate;NPER;PMT;PV;type)

So, after solving this, the balance at the end of the one year is $2,609.45