QUESTION 5

Part A: You owe $30,000 on your credit card. The credit card charges interest monthly and has an APR of 18.0%. With $620 monthly payment, what is the principal payment for the second payment?

a. 172.55

b. 142.55

c. 272.55

d. 372.55

Part B: You owe $30,000 on your credit card. The credit card charges interest monthly and has an APR of 18.0%. With $620 monthly payment, what is the ending balance after the fifth payment is made?

a. 28,941

b. 29,305

c. 28,906

d. 29,124