question archive You have a credit card balance of $8,000
You have a credit card balance of $8,000
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You have a credit card balance of $8,000. Your credit card charges a 20% interest rate, and the last bill shows a minimum payment of $150 this month. How many months it will take you to pay off your credit card, if you pay just the minimum monthly payment?
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Option One : Assuming end of month payments
Using financial calculator
I/Y=20%/12
PMT=-150
PV=8000
FV=0
CPT N=132.929
132.93 months or 11.08 years
Option Two : Assuming beginning of month payments
Using financial calculator
Set the mode to BGN
I/Y=20%/12
PMT=-150
PV=8000
FV=0
CPT N=132.936
132.94 months or 11.08 years
Step-by-step explanation
A
