9 . TI Calculator Graded Problem Set

Like many college students, Kristen applied for and got a credit card that has an annual percentage rate (APR) of 18%. The first thing she did was buy a new stereo system for $300. At the end of the month, her credit card statement said she only needed to make a minimum monthly payment of $10. Assume Kristen makes her payment when she sees her statement at the end of each month. If Kristen doesn't charge anything else and only makes the minimum monthly payments, approximately how many months would it take her to completely pay off the stereo system? Assume that the credit card company compounds interest at the end of each month.

31.2 months

32.6 months

40.2 months

20.8 months

37.8 months

Kristen now realizes she needs to pay more than just the minimum payment (unless she wants to be paying for this stereo system until she graduates). She decides to pay twice the minimum monthly payment ($20 per month), instead. How much quicker will she pay off the stereo system?

13.9 months

16.8 months

21.1 months

23.1 months

17.9 months

If, instead, Kristen wants to have the stereo system paid for by the end of the year, what minimum monthly payment must she make?

$29.08

$23.56

$35.54

$27.50

$36.10