1. How long will it take them to pay for the television?

2. What is the total amount they will pay for the television?

3. What is their total cost of using credit to purchase the TV?

Bill and Melinda are a young couple who have just finished college. They have a combined monthly net income of $3,500. Their fixed monthly expenses consist of $975 for rent, a car payment of $267 per month, and a car insurance premium of $68 per month. Their combined expenses per month for gas, utilities, food, clothing and entertainment are $650.

Bill wants to celebrate their successful completion of college by purchasing a brand new $550 television set by using a credit card that has an Annual Percentage Rate (APR) of 19.85%.

If they only pay the minimum monthly payment of $18.50.