Credit Cards
a) Will credit cards help? The average undergraduate student leaves college with a diploma and
around $2750 in credit card debt (graduate students, $4800). Suppose you have a credit card
with a balance of $2750 and an interest rate of 19.8% APR. The minimum payment is $45.00.
, where r is the rate
The amount of interest due each month is figured as current balance•(r/n)
(decimal form) and n is 12.
b) Will you ever be out of debt with the credit card company? Explain.