Rahm's credit card issuer calculates interest based on the outstanding

balance at the end of the last billing period. What is this method of

calculating interest on a credit card called?

O

A. Adjusted balance method

B. Average daily balance method

O C. Previous balance method

O D. None of the above

Adjusted balance method.

Explanation:

Adjusted balance method is defined a method of calculating financial interest based on the outstanding balance at the end of the last billing period after the payments after all necessary adjustment to the account has been made.

This method of interest calculating leads to a reduced finance charge with time as payments are being made to offset and reduce the balance on the card