A department store offers you the following credit card offer: No money down and no interest for 5 years. You have been considering a new furniture purchase for your home and decide to sign up for this attractive offer as you purchase $10,000 worth of furniture. Since personal funds are low, you decide to utilize the no payment, no interest option for 5 years, and plan to begin making the 2% per month payments when the five year offer ends. You also decide not to make any more charges on this credit card

So in this assignment, we pick up at the end of the 5-year period, with a $10,000 debt on a credit card. The interest rate = 17% APR of your outstanding balance. Each month, you pay the minimum monthly payment = 2% of outstanding debt. When the outstanding balance

When you are finished with the table, answer the following questions.

1. How many years did it take to pay off this debt?

2. How much did you actually pay for this furniture?

3. How much interest did you pay?

4. There are times when everyone needs to borrow money. Assuming that the loan was necessary, identify at least 2 strategies that would have helped lower the total amount paid for this furniture.

5. Suppose you HAD decided to add more charges to the credit card before or even while trying to pay off this furniture purchase? Copy the first few lines of your existing work onto a second worksheet and experiment by adding what you think is a typical monthly expenditure (and it does not have to be the same amount each month). Complete 12 24 months. What observations can be made?

Remaining Outstanding) Balance End of Month # You charged this amount on a credit card. ---> The bill arrives and you make the 2% minimum payment. ---> 1 Next month's bill = $9800 + interest on the outstanding balance. --> 2 You Make a Minimum Monthly Plus Interest Applied to Payment of 2% the Amount of Billed Amount of the Billed Outstanding Balance For This Month Amount $ 10,000.00 $ 10,000.00 $ 200.00 $ 138.83 $ 9,938.83 $ 198.78 $ 137.98 $ 9,878.04 $ 197.56 $ 137.14 $ 9,817.62 $ 196.35 S 9,800.00 9,740.06 9,680.48 Plus Interest Applied to the Remaining Amount of End of Outstanding) Outstanding Month # Balance Balance You charged this amount on a credit card. ---> The bill arrives and you make the 2% minimum payment. ---> 1 Next month's bill = $9800 + interest on the outstanding balance. --> 2 $ 9,800.00 $ 138.83 3 $ 10,132.06 $ 143.54 Plus this Month's Credit Card Charges You Make a Minimum Monthly Billed Amount For Payment of 2% of This Month the Billed Amount $ 10,000.00 $ 10,000.00 $ 200.00 $ 10,338.83 $ 206.78 $ 10,675.59 $ 213.51 $ $ 400.00 400.00