If you have a balance of $1,375 on your credit card and your card has a limit of $2,500, what should you pay before the end of the month statement to get it to an acceptable balance (50% debt ratio)?
$375 ***
$125
$1,250
No.
What is half of $2,500?
Subtract your balance.
Did you follow my directions?
It's B.
Yes, B.
To determine what payment you should make to get your credit card balance to a 50% debt ratio, you first need to calculate what a 50% debt ratio would be based on your credit card limit. The debt ratio is the ratio of your credit card balance to your credit limit expressed as a percentage.
Step 1: Calculate the 50% debt ratio:
Debt Ratio = (Credit Card Balance / Credit Card Limit) * 100
Given that your credit card balance is $1,375 and your credit card limit is $2,500:
Debt Ratio = (1,375 / 2,500) * 100
Debt Ratio = 0.55 * 100
Debt Ratio = 55%
So, a 50% debt ratio would be $1,250.
Step 2: Determine the amount you need to pay to achieve the desired debt ratio:
Payment Amount = Credit Card Balance - Desired Credit Card Balance
Desired Credit Card Balance = $1,250
Credit Card Balance = $1,375
Payment Amount = $1,375 - $1,250
Payment Amount = $125
Therefore, you should pay $125 before the end of the month statement to get your credit card balance to an acceptable balance with a 50% debt ratio.