1. You have an unpaid credit card debt of $461. The interest rate you carry is...

Transcribed Image Text:

1. You have an unpaid credit card debt of $461. The interest rate you carry is 17.55%. Make a table showing Payment Number, Monthly Payment, Balance Less Payment, Plus Interest, and Remaining Balance. (A) Assuming no extra charges, how long will it take to pay off the loan if you make the minimum payment of $25 per month? (B) Would it take exactly half the time to pay off the credit card debt if you doubled up on payments each month? If not, how much sooner do you pay the debt off in this case when compared to the first case? (C) Determine the amount of interest paid in (A). Determine the amount of interest paid in (B). Determine how much you save in interest when you double up on the payments. (D) In scenario (A), assume you make 7 minimum payments and then decide to transfer the balance to another card. There is a one-time transfer fee of 1% of the current balance. You resume minimum monthly payments for 8 months, during which time you enjoy a 2.35% interest rate. After these 8 months, you continue making minimum payments at an 18.95 interest rate until the balance is finally paid off. Was it worth it to switch cards (when compared to a scenario (A) payoff)? Why or why not? 1. You have an unpaid credit card debt of $461. The interest rate you carry is 17.55%. Make a table showing Payment Number, Monthly Payment, Balance Less Payment, Plus Interest, and Remaining Balance. (A) Assuming no extra charges, how long will it take to pay off the loan if you make the minimum payment of $25 per month? (B) Would it take exactly half the time to pay off the credit card debt if you doubled up on payments each month? If not, how much sooner do you pay the debt off in this case when compared to the first case? (C) Determine the amount of interest paid in (A). Determine the amount of interest paid in (B). Determine how much you save in interest when you double up on the payments. (D) In scenario (A), assume you make 7 minimum payments and then decide to transfer the balance to another card. There is a one-time transfer fee of 1% of the current balance. You resume minimum monthly payments for 8 months, during which time you enjoy a 2.35% interest rate. After these 8 months, you continue making minimum payments at an 18.95 interest rate until the balance is finally paid off. Was it worth it to switch cards (when compared to a scenario (A) payoff)? Why or why not?

Answer rating: 100% (QA)

Credit Card Debt Payoff Analysis Heres the analysis you requested Table Payment Number Monthly Payme... View the full answer