You have just purchased a new gaming system and some new games using your credit card. You paid $325 for the system and the games. Using what you have learned, create spreadsheets that will help you analyze how long it will take you to pay off the balance, and the true cost of the purchase, based on your payment strategy. Outstanding balance = $325.00 Annual percentage rate = 22% Minimum payment = $10 . 1. Use the credit card pay off calculator to see how long it will take you to pay off the credit card balance if you make only minimum monthly payments. Answer the following questions. a. How long will it take you to pay off the credit card balance if you make only minimum monthly payments? b. If you make only minimum monthly payments, what will the overall cost of the purchase be once you have paid it off? c. How much of this amount will you have paid in interest? 2. Use the credit card pay off calculator to see what would happen to the overall cost of the items if you made a payment of $50 per month. Answer the following questions. a. If you make a payment of $50 per month, what happens to the overall cost of the item? b. How long will it take you to pay it off? c. How much will you pay in interest using this scenario? 3. Based on what you have learned about using credit cards, is it wise to purchase the gaming system and games using a credit card? Explain your answer. 4. If you had the opportunity to purchase something you really wanted using a credit card vs. waiting until you saved the money needed to make the purchase, which option would you choose? Explain why. You have just purchased a new gaming system and some new games using your credit card. You paid $325 for the system and the games. Using what you have learned, create spreadsheets that will help you analyze how long it will take you to pay off the balance, and the true cost of the purchase, based on your payment strategy. Outstanding balance = $325.00 Annual percentage rate = 22% Minimum payment = $10 . 1. Use the credit card pay off calculator to see how long it will take you to pay off the credit card balance if you make only minimum monthly payments. Answer the following questions. a. How long will it take you to pay off the credit card balance if you make only minimum monthly payments? b. If you make only minimum monthly payments, what will the overall cost of the purchase be once you have paid it off? c. How much of this amount will you have paid in interest? 2. Use the credit card pay off calculator to see what would happen to the overall cost of the items if you made a payment of $50 per month. Answer the following questions. a. If you make a payment of $50 per month, what happens to the overall cost of the item? b. How long will it take you to pay it off? c. How much will you pay in interest using this scenario? 3. Based on what you have learned about using credit cards, is it wise to purchase the gaming system and games using a credit card? Explain your answer. 4. If you had the opportunity to purchase something you really wanted using a credit card vs. waiting until you saved the money needed to make the purchase, which option would you choose? Explain why
