Here is Justin's credit card statement for the month of June. Date June 1 Beginning balance June 9 Payment June 23 Purchase June 26 Payment Date Transaction (a) Use the credit card statement to help fill in the table below. Note that there are 30 days in June. Also, a purchase increases the unpaid balance, and a payment decreases the unpaid balance. June 1 June 9 Transaction Beginning balance Payment June 23 Purchase Transaction amount $2500.04 $840.00 $46.35 $200.00 June 26 Payment Transaction Unpaid amount balance $2500.04 $2500.04 $840.00 $1660.04 $46.35 $1706.39 $200.00 $1506.39 Number of days at that balance 8 days (from June 1 through June 8) 14 days (from June 9 through June 22) 3 days (from June 23 through June 25) 5 days (from June 26 through June 30) Total: 30 days Unpaid Number balance of days $20,000.32 X $23240.56 $5119.17 $7531.95 Total: $55892.00 S (b) Find the average daily balance. Write your answer to the nearest cent. $1863.06 (c) Suppose credit card company charges an interest rate of 1.4% on the average daily balance for June found in part (b). How much interest will be charged? Write your answer to the nearest cent. $782.49
Here is Justin's credit card statement for the month of June. Date June 1 Beginning balance June 9 Payment June 23 Purchase June 26 Payment Date Transaction (a) Use the credit card statement to help fill in the table below. Note that there are 30 days in June. Also, a purchase increases the unpaid balance, and a payment decreases the unpaid balance. June 1 June 9 Transaction Beginning balance Payment June 23 Purchase Transaction amount $2500.04 $840.00 $46.35 $200.00 June 26 Payment Transaction Unpaid amount balance $2500.04 $2500.04 $840.00 $1660.04 $46.35 $1706.39 $200.00 $1506.39 Number of days at that balance 8 days (from June 1 through June 8) 14 days (from June 9 through June 22) 3 days (from June 23 through June 25) 5 days (from June 26 through June 30) Total: 30 days Unpaid Number balance of days $20,000.32 X $23240.56 $5119.17 $7531.95 Total: $55892.00 S (b) Find the average daily balance. Write your answer to the nearest cent. $1863.06 (c) Suppose credit card company charges an interest rate of 1.4% on the average daily balance for June found in part (b). How much interest will be charged? Write your answer to the nearest cent. $782.49
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Help with part C please
![### Justin's Credit Card Statement for June
**Statement Overview:**
- **June 1:** Beginning balance of $2500.04
- **June 9:** Payment of $840.00 made, decreasing the balance
- **June 23:** Purchase of $46.35 made, increasing the balance
- **June 26:** Payment of $200.00 made, decreasing the balance
**Detailed Breakdown Table:**
| Date | Transaction | Transaction Amount | Unpaid Balance | Number of Days at that Balance | Unpaid Balance × Number of Days |
|------------|--------------------|--------------------|----------------|-------------------------------|---------------------------------|
| June 1 | Beginning balance | $2500.04 | $2500.04 | 8 days (June 1-8) | $20,000.32 |
| June 9 | Payment | $840.00 | $1660.04 | 14 days (June 9-22) | $23,240.56 |
| June 23 | Purchase | $46.35 | $1706.39 | 3 days (June 23-25) | $5,119.17 |
| June 26 | Payment | $200.00 | $1506.39 | 5 days (June 26-30) | $7,531.95 |
| **Total:** | | | **30 days** | | **$55,892.00** |
**Questions and Answers:**
**(b)** **Average Daily Balance Calculation:**
To find the average daily balance, divide the total of the "Unpaid Balance × Number of Days" by the number of days in the month (30 days).
\[
\text{Average Daily Balance} = \frac{\text{Total of Unpaid Balance × Number of Days}}{\text{Number of Days in the Month}} = \frac{55892.00}{30} = 1863.06
\]
**Answer:** $1863.06
**(c)** **Interest Calculation:**
The interest rate charged by the credit card company is 1.4% on the average daily balance for June.
\[
\text{Interest} = \text{Average Daily Balance} \times \text{Interest Rate](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fae063e21-e069-49f8-ad73-1d555b7f1041%2F92238b8c-a0ad-4ec8-ac88-17c7a5fcc664%2Fmcuicf3_processed.jpeg&w=3840&q=75)
Transcribed Image Text:### Justin's Credit Card Statement for June
**Statement Overview:**
- **June 1:** Beginning balance of $2500.04
- **June 9:** Payment of $840.00 made, decreasing the balance
- **June 23:** Purchase of $46.35 made, increasing the balance
- **June 26:** Payment of $200.00 made, decreasing the balance
**Detailed Breakdown Table:**
| Date | Transaction | Transaction Amount | Unpaid Balance | Number of Days at that Balance | Unpaid Balance × Number of Days |
|------------|--------------------|--------------------|----------------|-------------------------------|---------------------------------|
| June 1 | Beginning balance | $2500.04 | $2500.04 | 8 days (June 1-8) | $20,000.32 |
| June 9 | Payment | $840.00 | $1660.04 | 14 days (June 9-22) | $23,240.56 |
| June 23 | Purchase | $46.35 | $1706.39 | 3 days (June 23-25) | $5,119.17 |
| June 26 | Payment | $200.00 | $1506.39 | 5 days (June 26-30) | $7,531.95 |
| **Total:** | | | **30 days** | | **$55,892.00** |
**Questions and Answers:**
**(b)** **Average Daily Balance Calculation:**
To find the average daily balance, divide the total of the "Unpaid Balance × Number of Days" by the number of days in the month (30 days).
\[
\text{Average Daily Balance} = \frac{\text{Total of Unpaid Balance × Number of Days}}{\text{Number of Days in the Month}} = \frac{55892.00}{30} = 1863.06
\]
**Answer:** $1863.06
**(c)** **Interest Calculation:**
The interest rate charged by the credit card company is 1.4% on the average daily balance for June.
\[
\text{Interest} = \text{Average Daily Balance} \times \text{Interest Rate
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