You make a purchase of $600 on a new credit card with a yearly interest rate of 12%. You make a large payment your first month of $200. What is the credit card’s balance before you make the payment?(1 point)
The balance before making the payment would be $600.
Initial balance: $600
Payment made: -$200
Balance before payment: $600
Wrong You make a purchase of $600 on a new credit card with a yearly interest rate of 12%. You make a large payment your first month of $200. What is the credit card balance before you make the payment?(1 point)
Answer choices:
$606
$406
$472
$672
To find the balance before you make the payment, you first need to calculate the interest accrued on the $600 over the course of one month:
Interest = Principal * Rate * Time
Interest = $600 * 12% * (1/12) (since it's one month)
Interest = $600 * 0.01
Interest = $6
So, the balance before you make the payment would be:
$600 (purchase) + $6 (interest) = $606
Therefore, the correct answer is:
$606