PLEASE HELP I HAVE NO IDEA You owe $1,853.42 on a credit card with a limit of $3,000.00 at a rate of 15.5% APR. You pay $400.00 the first 2 months and then $200.00 until the bill is paid off. You pay the bill on the due date each month. 1) Complete the table showing the decreasing debt. 2) How much is your last payment? 3) What is the total amount paid by the time you pay off the credit card? 4) What was your debt ratio at the beginning?

Part 1:

The table showing the decreasing debt is shown as follows:

[tex]\begin{tabular} {|c|c|c|c|} Starting Balance&Interest Accrued&Payment&Closing Balance\\[1ex] \$1,853.42&\$22.39&\$400&\$1,475.81\\\$1,475.81&\$17.83&\$400&\$1,093.64\\\$1,093.64&\$13.21&\$200&\$906.85\\\$906.85&\$10.96&\$200&\$717.81\\\$717.81&\$8.67&\$200&\$526.48\\\$526.48&\$6.36&\$200&\$332.84\\\$332.84&\$4.02&\$200&\$136.86\\\$136.86&\$1.65&\$138.51&- \end{tabular}[/tex]

The column for interest accrued is obtained by the folmular

[tex]I=P(1+0.155)^{\frac{1}{12}}[/tex]

where P is the month's starting balance.



Part 2:

From the table, the last payment is $138.51



Part 3:

The total amount paid by the time the credit card is payed of is the summation of the "payment" column of the table.

Thus, the total amount is given by:

[tex]Payment\ total=2(400)+5(200)+138.51=\$1,938.51[/tex]



Part 4:

The debt ratio is given by

[tex]Debt\ ratio= \frac{debt}{limit} = \frac{1,853.42}{3,000} \approx0.62[/tex]