document.write( "Question 979459: A $5,000 debt on a credit card will take 32 years to repay if only the minimum monthly payment is made. This debt will cost the borrower about $7,800 in interest. The borrower could be out of debt in 3 years by paying $175 per month. Find the amount of interest paid at the end of 3 years. \n" ); document.write( "
Algebra.Com's Answer #600969 by KMST(5328)\"\" \"About 
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A debt of $5,000 paid over 32 years with a total interest paid of only $7,800 must involve larger payments at the beginning and smaller payments later, based on the balance at the time of the payment.
\n" ); document.write( "Calculations could be complicated.
\n" ); document.write( "However, that seems not to matter to solve the problem.\r
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\n" ); document.write( "\n" ); document.write( "If a $5,000 debt he total can be paid in 3 years by paying $175 per month,
\n" ); document.write( "the total amount paid over those 3 years is
\n" ); document.write( " .
\n" ); document.write( "That amounts to repaying the \"%22%245000%22\" original debt plus interest amounting to
\n" ); document.write( "\"%22%246300%22-%22%245000%22=highlight%28%22%241300%22%29\" , and that is what I believe the problem is asking for.\r
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\n" ); document.write( "\n" ); document.write( "NOTES:
\n" ); document.write( "That $175 monthly payment means
\n" ); document.write( "an interest rate of 15.68% per year,
\n" ); document.write( "compounded monthly,
\n" ); document.write( "with payments made at the end of each month.
\n" ); document.write( "The interest paid on the first month would be $65.33.
\n" ); document.write( "The difference, $175 - $65.33 = $109.67, would be applied to reduce the balance owed.
\n" ); document.write( "If only $65.33 was paid at the end of each month,
\n" ); document.write( "the loan balance would be $5,000 after each monthly payment,
\n" ); document.write( "and it would take eternity to repay the loan.
\n" ); document.write( "With a payment only a little larger than $65.33 (let's say $66, or $70) at the end of each month,
\n" ); document.write( "the loan would be fully paid in less than 32 years,
\n" ); document.write( "but then, the total amount paid,
\n" ); document.write( "and the total interest paid would be a lot more.
\n" ); document.write( "To pay only $7,800 in interest, and still take 32 years to repay,
\n" ); document.write( "larger payments are needed at the beginning,
\n" ); document.write( "when the balance and the monthly interest owed is larger.
\n" ); document.write( "Credit cards' minimum payments are based on balance,
\n" ); document.write( "such as 1/50 of the balance or a fixed quantity (whichever is less),
\n" ); document.write( "so minimum payments are larger at the beginning. \n" ); document.write( "
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