Use the Credit Card Payoff Calculator at bankrate.com to respond to the following items. Enter

the

numbers as given by the calculator for your responses.

NOTE: this calculator rounds

significantly so answers will not be

the exact answer you will

have in reality

.

Given: account balance = $5,000; account APR = 17%

1.

If you plan to pay the entire balance off using a fixed payment of 4% of the original

balance, what is the dollar amount of the fixed payment?

2.

How many months will it take to pay off

the entire

balance if you make a fixed payment

of 4% of the original balance

, ceteris paribus?

3

.

What is the dollar amount

paid in interest if a

fixed payment

of 4% of the original

balance

is made

to pay off the

entire

balance of $5,000, ceteris paribus?

4

.

What is the

monthly

payment amount that will pay the off the

entire $5,000 original

balance in 24 months, ceteris paribus?

5.

What is the dollar amount paid in interest if the balance is paid off in 24

months, ceteris

paribus?

6.

How much more will you pay in interest if you make a fixed payment of 4% of the

original balance than if you make the payment required to pay the balance off in 24

months?

7

.

If the minimum payment is 4% of the outstanding

balance, how many months will it take

to pay off the entire balance if only the minimum payment is made each month, ceteris

paribus?

8

.

What is the dollar amount paid in interest if the minimum payment is made each month to

pay off the entire balance, ceteris paribus?