Concept explainers
Use the result of Problem 66 to show that if the minimum monthly payments are always calculated the same way and the borrower never pays more than the minimum that the loan will technically never reach a zero balance. Then explain why that doesn’t mean that realistically it won’t ever be paid off.
66. Here’s another approach to the calculation in Example 8. It’s actually like a savings account with negative interest: instead of 1% of the amount being added each compounding period (month in this case), 1% is being subtracted from the amount. Use the compound interest formula with a principal balance of $2,300 and interest of −1% per month compounded monthly for 6 months. How does the result compare to the calculations in Example 8?
EXAMPLE 8 Studying the Effect of Making Minimum Payments
Suppose you have a $2,300 balance on a credit card with an interest rate of 1.1% per month, and the minimum payment for any month is the amount of interest plus 1% of the principal balance. If you don’t make any more purchases on that card and make the minimum payment for 6 months, how much will you pay down the balance?

Want to see the full answer?
Check out a sample textbook solution
Chapter 7 Solutions
MATH IN OUR WORLD:LL W/ALEKS >BI<
- Please refer belowarrow_forwardMATLAB. Awnser written questions (*) in the comments. Null, Rank, and most functions outside of rref() and disp() are not allowed!arrow_forwardMATLAB. Awnser written questions (*) in the comments. Null, Rank, and most functions outside of rref() and disp() are not allowed! Solutions must be given manually! Elementary form means to reduce to RREF manually, without rref(). Please see other attached image for explanationarrow_forward
- a. Given D = (1 2,6 4 )decode the following message: 32, 24, 42, 28, 24, 40, 50, 60, 132, 96, 12, 24 where the item in brackets is a 2*2 Matrix and the rows are separated by commasarrow_forwardMATLAB. Awnser written questions (*) in the comments. Null, Rank, and most functions outside of rref() and disp() are not allowed! Solutions must be given manually!arrow_forwardPLEASE ALL PARTS!!!arrow_forward
- Please refer belowarrow_forwardPlease refer belowarrow_forwardMatlab Do question #3 from Section 1.10 Exercises of the textbook (theproblem about Mac and Cheese). For each part, be sure to explicitly give the appropriate system ofequations (as a comment) before entering the appropriate matrices into MATLAB. Show all of yournecessary MATLAB computations.arrow_forward
- PLEASE ANSWER ALL PARTSarrow_forwardPLEASE ANSWER BOTH PARTSarrow_forward(1) (16 points) Let f(x, y) = 2x + 3y + In(xy) (a) (6 points) Calculate the gradient field Vf(x, y) and determine all points (x, y) where ▼f(x, y) = (0, 0). (b) (4 points) Calculate the second derivative matrix D²f(x,y).arrow_forward
- Intermediate AlgebraAlgebraISBN:9781285195728Author:Jerome E. Kaufmann, Karen L. SchwittersPublisher:Cengage LearningAlgebra for College StudentsAlgebraISBN:9781285195780Author:Jerome E. Kaufmann, Karen L. SchwittersPublisher:Cengage Learning


