In: Finance
On November 1st, Ava’s credit card has a balance of $4,501.00. According to the terms of the card’s lending agreement, an interest rate of 18% per year is assessed and the monthly finance charges are calculated using the Average Daily Balance (ADB) including purchases method.
During the month, Ava expects to make the purchases listed below and will make a payment of $337.58 on November 25thth, and has collected the following additional information:
Date |
Purchases |
---|---|
November 5 | $1,835.95 |
November 15 | 55.60 |
November 19 | 63.10 |
November 27 | 447.77 |
Additional Information
Monthly interest rate | 1.50% |
Beginning card balance | $4,501.00 |
Days in the month | 30 |
Use the following table to help Ava estimate her monthly interest charge for November.
Dates |
Number of Days |
Daily Balance |
Calculated Value |
---|---|---|---|
11/ - 11/ | |||
11/ - 11/ | |||
11/ - 11/ | |||
11/ - 11/ | |||
11/ - 11/ | |||
11/ - 12/ | |||
Total | |||
Average Daily Balance With Purchases | |||
Finance Charge |
One way by which Ava can reduce her finance charges, everything else remaining constant, is to:
Make more, even more expensive purchases
Make smaller payments
Request a lower interest rate on her credit card