document.write( "Question 389414: How many months will it atke to pay off a credit card with a balance of of $1000 if you only pay the minimum payment of $20 each month? Your Annual Percentage Rate is 12.96% \n" ); document.write( "

Algebra.Com's Answer #275945 by ewatrrr(24785) $\"\"$ $\"About$

You can put this solution on YOUR website!


\n" );
document.write( "Hi, previousy posted        
\n" );
document.write( "Note: formula for N(the number of months)to pay off the $1000 is as follows: 
\n" );
document.write( "N = −log(1−i*A/P) / log(1+i) where A = 1000, P = 20 and i = 12.96/12 = 1.08/mo
\n" );
document.write( "N = −log(1−(.0108)*1000/20) / log(1.0108)
\n" );
document.write( "N = −log(1−.54)/ log(1.0108)
\n" );
document.write( "N =  - log (.46) / log(1.0108) = -(-.7765)/.0107 = 72.57 months
\n" );
document.write( "After 72 months there will be a balance which can be determined by using:
\n" );
document.write( "B = A(1+i)^72 - P/i[(1+i)^72 - 1]
\n" );
document.write( "B = 1000(1.0108)^72 - 20/.0108[(1.0108)^72 - 1] 
\n" );
document.write( " \n" );
document.write( "

\n" );