M A B C D E F G H K L 2-5: Credit Card Interest -- Interest on Balance -- Minimum Payment Scenario: You just had $2000 in car repairs and decide to put it on a credit card and pay the minimum required 2 listed on the bill. 3 Starting Balance $2,000 Interest Rate 1.75% per month Note: This is an APR of 21% Required Minimum Payment 5 Towards Balance 1.25% per month 6 M Balance Finance Charge Minimum reduction in balance Month's Payment New Balance 1. Write a formula in Cell C8 to compute the monthly Finance Charge (Simple Interest) based on the Balance in Column B and the interest rate in Cell 14. Remember to use SDSA" to keep this cell in copied formulas. 1 $2,000 2 9 10 3 4 2 13 14 5 6 2. In cell D8, Use a formula to compute the minimum balance reduction required based on the Balance in Column B and the required minimum percentage to pay in. DSSD$S) 7 Inici Minimum Payment Extra Pay HE Type here to search O B D E F M 8 G H K 3. In Cell E8, use a formula to compute the required payment for the month: CF 9 10 11 12 13 4. Compute the new Balance for the next month: In cell F8, use a formula to subtract the minimum reduction in balance from the old Balance in B8. Then copy this cell to B9 (=F8). 14 15 16 17 18 + 5. Copy the formulas from C8,D8, E8,F8 to c9,09,19,F9. Now row 9 is complete so you can copy row 9 to the other months in the table (144 total months or twelve years) 19 20 21 22 23 24 25 6. Analysis: After 12 years! a. How much interest did you pay on this $2000 loan? b. How much do you still owe? ANSWERS: 26 27 Minimum Payment Extra Pay dj O ype here to search M A B D E M 30 23 24 25 31 32 33 34 G H K L 6. Analysis: After 12 years! a. How much interest did you pay on this $2000 loan? b. How much do you still owe? ANSWERS: a. Interest Paid: b. Still Owe: 26 27 35 28 36 29 151 144 152 153 154 155 Total Interest: $0.02 Total paid on balance: $0.01 Amount still owed: $0.00 156 757 158 159 160 161 762 163 Minimum Payment Extra Pay Ready o