Search
Ask a question
0

Financing Word Problem - HELP!

Mario neglected to pay a credit card bill of $1550 at 17%/a, compounded daily, for 2 weeks after it was due. What is the amount he must pay to settle the bill at the end of 2 weeks?

2 Answers by Expert Tutors

Tutors, sign in to answer this question.
Brett K. | Experienced Math and Spanish TutorExperienced Math and Spanish Tutor
0
First when you see that 17% compounded daily rate, we must convert it to a rate more usable:
(1+(.17/365))^14   is the interest factor that we can use.
so to piece it all together:
1550*(1+(.17/365))^14=FV [of cc debt it 2 weeks (14 days)]
Deanna L. | Electrical engineering major and music lover with MIT degreeElectrical engineering major and music l...
4.9 4.9 (123 lesson ratings) (123)
0
this is a matter of 1550 multiplied by .17/365, compounded daily, to the 14th power or 1550 times 1 plus .17/365, to the 14th.