You have a balance of $15,000 for your tuition on your American Express credit card. If your APR is 21%, you make no further charges, and each month you make only the minimum payment of 3% of your balance, then the formula for the balance after t monthly payments is given by 15,000(0.986975)t . What will the balance be after 10 years?
A. $3768.92
B. $4043.03
C. $3150.00
D. $3110.50
Using the given formula, your expression is correct, but its value is 3110.50 (D)
Expressed correctly, of course, it would be
15,000(0.986975)^(10*12)
You must have pushed some buttons wrong if you got (A). Or just guessed...
To find the balance after 10 years, we need to use the given formula:
Balance = 15,000 * (0.986975)^t
Here, t represents the number of monthly payments. Since we want to find the balance after 10 years, we need to convert the years into months. There are 12 months in a year, so 10 years will be 10 * 12 = 120 months.
Now, substitute the value of t into the formula and calculate:
Balance = 15,000 * (0.986975)^120
≈ 15,000 * 0.404303
Calculating this, we find:
Balance ≈ 6,064.545
Rounding this to the nearest cent, the balance after 10 years will be approximately $6,064.55.
The correct answer among the given choices is not provided, but based on the calculation, none of the options listed match the result.
I think it's A.
15,000(0.986975)^10(12)
Hmmm -- 10 math problems -- with no indication that you've made any attempt to solve them.
Please do not post any more problems until you've shown us your work on the ones you've already posted.