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21 November, 19:12

You got a new credit card with an interest rate of 18% compounded monthly and no minimum payment. you go on a shopping spree and purchase $10,000 worth of clothes and shoes. If you wait 6 months to pay the bill, how much more will you owe than if you had paid the bill immediately?

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  1. 21 November, 19:19
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    The total amount owed after 6 months will be found using the formula:

    FV=P (1+r/100*n) ^n

    P=principle=$10000

    r=rate=18%

    n=terms=0.5

    FV=10000 (1+18/2*100) ^0.5

    FV=$10,440.30651

    Thus the amount owed will be $10440.30651
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