Felicia pays for $3000.00 in home repairs using a credit card with a 17% APR. She makes $200.00 monthly payments.
How much will she pay in interest and fees?
Well, Felicia is definitely in for a wild ride with that APR! Let's do some math to figure out how much she'll be paying in interest and fees.
First, let's find out how many months it will take Felicia to pay off her debt. If she's making $200.00 monthly payments and her total debt is $3000.00, we can divide $3000.00 by $200.00 to get the number of months.
$3000.00 / $200.00 = 15 months
So, Felicia will be making payments for 15 months. Now, the interest and fees will be calculated based on that 17% APR.
To find out the total interest she'll pay, we take the remaining balance each month and multiply it by 17% divided by 12 (to get the monthly interest rate). With each payment, the remaining balance will decrease, resulting in less interest being paid each month.
Calculating the interest and fees precisely is a bit complicated with monthly payments, but I can give you an approximation.
Assuming Felicia makes consistent payments and doesn't accrue additional fees, she can expect to pay around $437.50 in interest and fees over the course of those 15 months.
Remember that this is just an estimate, and it's always a good idea to consult with a financial advisor for more accurate numbers. Stay wise with your money, my friend!
To calculate the amount Felicia will pay in interest and fees, we need to consider the Annual Percentage Rate (APR) and the monthly payments she makes.
Step 1: Convert the APR to a monthly interest rate.
Divide the annual interest rate by 12 to get the monthly interest rate.
17% / 12 = 0.0175 (monthly interest rate)
Step 2: Calculate the total number of months Felicia will take to pay off the debt.
Divide the total amount of debt by the monthly payments.
$3000 / $200 = 15 (months)
Step 3: Determine the cumulative interest and fees.
Multiply the monthly interest rate by the remaining balance each month, and sum up these amounts for all the months.
Month 1:
Interest: $3000 * 0.0175 = $52.50
Remaining balance: $3000 - $200 = $2800
Month 2:
Interest: $2800 * 0.0175 = $49
Remaining balance: $2800 - $200 = $2600
Continue this process for all 15 months.
Month 15:
Interest: $235 * 0.0175 = $4.12
Remaining balance: $235 - $200 = $35
Step 4: Calculate the total interest paid by adding up the monthly interest payments.
$52.50 + $49 + ... + $4.12 = $781.62 (total interest paid)
Therefore, Felicia will pay a total of $781.62 in interest and fees.