Question
In: Finance
(Nonannual compounding using a calculator) Dennis Rodman has a$4,000 debt balance on his Visa card...
(Nonannual compounding using a calculator) Dennis Rodman has a $4,000 debt balance on his Visa card that charges an APR of 13.1 percent compounded monthly. Dennis's current minimum monthly payment is percent of his debt balance, $200. How many months (round up) will it take Dennis to pay off his credit card if he pays the current miminum payment of $200 at the end of each month? How many months will it take Dennis to pay off his credit card?
(Round up to the nearest unit.)
Solutions
Expert Solution
The number of months is computed as follows: (Using a financial calculator BA II PLUS)
Plug the below variables in the financial calculator as follows:
PV = - 4,000
I/Y = 1.091666667 (13.1 / 12)
PMT = 200
FV = 0
Finally press CPT and then press N. It will give number of months equal to 22.69 months or 23 months (if rounded to the nearest whole number) Approximately
jeff jeffy answered 2 years agoRelated Solutions
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Find the following values using the equations and then a financial calculator. Compounding/discounting occurs annually. Do...
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financial calculator. Compounding/discounting occurs annually. Do
not round intermediate calculations. Round your answers to the
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a. An initial $600 compounded for 1 year at 6%.
b. An initial $600 compounded for 2 years at 6%.
c. The present value of $600 due in 1 year at a discount rate of
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d. The present value of $600 due in 2 years at a discount rate
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Find the following values using the equations and then a financial calculator. Compounding/discounting occurs annually. Do...
Find the following values using the equations and then
a financial calculator. Compounding/discounting occurs annually. Do
not round intermediate calculations. Round your answers to the
nearest cent.
An initial $600 compounded for 1 year at 6%.
$
An initial $600 compounded for 2 years at 6%.
$
The present value of $600 due in 1 year at a discount rate of
6%.
$
The present value of $600 due in 2 years at a discount rate of
6%.
$
Find the following values using the equations and then a financial calculator. Compounding/discounting occurs annually. Do...
Find the following
values using the equations and then a financial
calculator. Compounding/discounting occurs annually. Do not round
intermediate calculations. Round your answers to the nearest
cent.
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compounded for 1 year at 4%.
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An initial $500
compounded for 2 years at 4%.
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$500 due in 1 year at a discount rate of 4%.
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not round intermediate calculations. Round your answers to the
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An initial $600 compounded for 2 years at 8%.
$
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a financial calculator. Compounding/discounting occurs annually. Do
not round intermediate calculations. Round your answers to the
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$
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