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Homework answers / question archive / Simon recently received a credit card with an 21
Simon recently received a credit card with an 21.5% nominal interest rate. With the card, he purchased an Apple iPhone 6 for $386.71. The minimum payment on the card is only $10 per month. a) If Layla makes the minimum monthly payment and makes no other charges, how many months will it be before he pays off the card? Round to the nearest month. (1.5 point) 1 Page b) If Layla makes monthly payments of $35. how many months will it be before he pays off the debt? Round to the nearest month. (1.5 point) c) How much more in total payments will Layla make under the S10-a-month plan than under the $35-a- month plan? Make sure you use three decimal places for N.
Part (a): If monthly payments are $10, number of months before paid off fully= 66 (rounded)
Calculated using NPER function of Excel.
Part (b): If monthly payments are $35, number of months before paid off fully= 12 (rounded)
Part (c ):
Total payment under $10- a month plan= $664.73
Total payment under $35- a month plan= $434.78
Amount paid more under the $10-a month plan than under the $35- a month plan= 664.73-434.78 =$229.95
Calculations as below:
please see the attached file for the complete solution.
