One credit card's APR is 12.99%. Assume monthly compounding frequency: calculate if you have a balance of $1,000 at the beginning of the year, how much you will have (owe) on balance one month later AND 12 months later? Assume you do not borrow more and you do not repay any money or interest throughout the year.

How can this compounding effect impact the borrowers? What recommendation(s) would you make to other borrowers to minimize the negative impact?