You owe 958.62 on a credit card at 9.7 percent apr the minimum payment is 105.00 how much goes toward principal if you make the minimum payment at the end of the first month?

Question

Mathematics

Julio Andersen

14 July, 07:18

You owe 958.62 on a credit card at 9.7 percent apr the minimum payment is 105.00 how much goes toward principal if you make the minimum payment at the end of the first month?

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Answers (1)

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Corey Mccormick · Answer 1

APR stands for Annual Percentage Rate and in this problem, we are given APR is equal to 9.7%

Per month rate = 9.7% / 12 months = 0.808%

Total credit interest for 12 months = 958.62 * 0.097 = $92.97

In one month = $92.97/12 = $7.7475

If you pay at the end of the first month:

Payment = 105.00

The amount goes to principal:

Amount = $105 - $ 7.7475

Amount = $142.25