Using the Adjusted Balance Method: If Monty sends in a payment for $1,000,how much will the finance charge be on his remaining balance? (Use the $6,000 balance for your calculations. )
A)$75
B)$90
C)$110
D)There is not enough information to solve this question.

Question

Quizplus · Accepted Answer

The finance charge is calculated by multiplying the remaining balance by the monthly interest rate. The monthly interest rate is 1.5%, or 0.015. The remaining balance is $6,000 - $1,000 = $5,000. Therefore, the finance charge is $5,000 x 0.015 = $75.

Using the Adjusted Balance Method: If Monty Sends in a Payment