case study 10c
CASE 10c g Off a Credit Card with Payments that Form an Annuity rking company. Within a e should lease it Payin After spending too much money on credit card interest last year, Alana applied for a new credit card that had a lower interest or y it e of 16.9% compounded daily. The terms ofher new credit card ne similar to her old one se vs. finance ayment she makes within a month from the date of purchase, she will be chargesd options -Howeyer, if she does not pay off the full balance, interest is charged daily on the remaining balance effective fron e, she will be charged no interest. date of purchase. Every month she must make a minimum payment rchases in the following months. a. On December 31, Alana made a payment of $100, and on the last days of January to May, respectively, she made the the car On November 30, Alana completed all of her Christmas shopping using her new credit card. Also, she did not mae any other plu 1.3o 21,500.00 $1,817.00 $3031.21 26,348.21 2000.00 minimum payment of $20 that was charged on her credit card. After the May 31 payment, the balance on her card was $610.06. What was the value of all the purchases she made on November 30? (Hint: Remember, interest is not charged on any payments she made within the first month) b. How much longer would it take Alana to pay off her debt if she continued to only make the minimum payment of $20 at the end of each month? Round your answer up to the next month. How much quicker could she pay off her debt by making payments of $40 at the end of each month instead? Round your answer up to the next month 48 $562.13 yments) Nil d. Alana was shocked by how long it would take for her to pay off her debt if she continued to only make the minimum ment of $20, and so she made a plan to be debt-free in six months. What equal payments would she have to make at pay the end of each month (starting on June 30) in order to achieve this goal? (halfway through her repayment plan)? her credit card since November 30 the previous year? e. If she followed her payment plan laid out in (d), what would the balance be on Alana's credit card after her third payment e lease option? f. If on November 30, after making he n economically CASE 10c g Off a Credit Card with Payments that Form an Annuity rking company. Within a e should lease it Payin After spending too much money on credit card interest last year, Alana applied for a new credit card that had a lower interest or y it e of 16.9% compounded daily. The terms ofher new credit card ne similar to her old one se vs. finance ayment she makes within a month from the date of purchase, she will be chargesd options -Howeyer, if she does not pay off the full balance, interest is charged daily on the remaining balance effective fron e, she will be charged no interest. date of purchase. Every month she must make a minimum payment rchases in the following months. a. On December 31, Alana made a payment of $100, and on the last days of January to May, respectively, she made the the car On November 30, Alana completed all of her Christmas shopping using her new credit card. Also, she did not mae any other plu 1.3o 21,500.00 $1,817.00 $3031.21 26,348.21 2000.00 minimum payment of $20 that was charged on her credit card. After the May 31 payment, the balance on her card was $610.06. What was the value of all the purchases she made on November 30? (Hint: Remember, interest is not charged on any payments she made within the first month) b. How much longer would it take Alana to pay off her debt if she continued to only make the minimum payment of $20 at the end of each month? Round your answer up to the next month. How much quicker could she pay off her debt by making payments of $40 at the end of each month instead? Round your answer up to the next month 48 $562.13 yments) Nil d. Alana was shocked by how long it would take for her to pay off her debt if she continued to only make the minimum ment of $20, and so she made a plan to be debt-free in six months. What equal payments would she have to make at pay the end of each month (starting on June 30) in order to achieve this goal? (halfway through her repayment plan)? her credit card since November 30 the previous year? e. If she followed her payment plan laid out in (d), what would the balance be on Alana's credit card after her third payment e lease option? f. If on November 30, after making he n economically
