You have been pricing Samsung-Galaxy SmartWatch in several stores. Three stores have the identical price of $700. Each store charges 24 percent APR, has a 30-day grace period, and sends out bills on the first of the month. On further investigation, you find that store A calculates the finance charge by using the average daily balance method, store B uses the adjusted balance method, and store C using the previous balance method. Assume you purchased the SmartWatch on May 5 and made a $100 payment on June 15. What will the finance charge for June be if you made your purchase from store A? From store B? From store C? Note: Do not round intermediate calculations. Round your answers to 2 decimal places. Finance Charge Store A Store B Store C
You have been pricing Samsung-Galaxy SmartWatch in several stores. Three stores have the identical price of $700. Each store charges 24 percent APR, has a 30-day grace period, and sends out bills on the first of the month. On further investigation, you find that store A calculates the finance charge by using the average daily balance method, store B uses the adjusted balance method, and store C using the previous balance method. Assume you purchased the SmartWatch on May 5 and made a $100 payment on June 15. What will the finance charge for June be if you made your purchase from store A? From store B? From store C? Note: Do not round intermediate calculations. Round your answers to 2 decimal places. Finance Charge Store A Store B Store C
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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![Problem 7-7 Comparing Costs of Credit Using Three Calculation Methods [LO7-2]
You have been pricing Samsung-Galaxy SmartWatch in several stores. Three stores have the identical price of $700. Each store
charges 24 percent APR, has a 30-day grace period, and sends out bills on the first of the month. On further investigation, you find that
store A calculates the finance charge by using the average daily balance method, store B uses the adjusted balance method, and
store C using the previous balance method. Assume you purchased the SmartWatch on May 5 and made a $100 payment on June 15.
What will the finance charge for June be if you made your purchase from store A? From store B? From store C?
Note: Do not round intermediate calculations. Round your answers to 2 decimal places.
Finance Charge
es
Store A
Store B
Store C](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fe59252c4-3091-42ab-8d0f-a497b9cb099a%2Fea30753e-fca7-4cef-a238-bea41949b9a2%2Ffwsuch_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Problem 7-7 Comparing Costs of Credit Using Three Calculation Methods [LO7-2]
You have been pricing Samsung-Galaxy SmartWatch in several stores. Three stores have the identical price of $700. Each store
charges 24 percent APR, has a 30-day grace period, and sends out bills on the first of the month. On further investigation, you find that
store A calculates the finance charge by using the average daily balance method, store B uses the adjusted balance method, and
store C using the previous balance method. Assume you purchased the SmartWatch on May 5 and made a $100 payment on June 15.
What will the finance charge for June be if you made your purchase from store A? From store B? From store C?
Note: Do not round intermediate calculations. Round your answers to 2 decimal places.
Finance Charge
es
Store A
Store B
Store C
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