SOLUTION: Kareem purchased a leather jacket for $800 with his new credit card. He budgeted $50 a month to pay toward the debt. When he read the fine print on the credit card statement, he sa

Question 40726: Kareem purchased a leather jacket for $800 with his new credit card. He budgeted $50 a month to pay toward the debt. When he read the fine print on the credit card statement, he saw that for each month he owed a balance, a finance charge of $17.50 would be added. How many months will it take Kareem to pay off the leather jacket?
Thanks

Answer by rajagopalan(174) (Show Source): You can put this solution on YOUR website!
monthly budget for jacket 50
finance charge/month 17.5
net credit per month = 50-17.5 = 32.5
cost of jacket = 800
months to repay = cost/net crdit = 800 / 32.5 = 24 months + 20 dollars
= 25 months. okay.
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