Ask Question
BusinessBusiness
29 March, 04:15

Mia received a credit card offer in the mail. The credit card has an annual percentage rate of 26%. What is the approximate monthly interest rate that will apply to any unpaid balances on this credit card? Assume 12 equal months.

+4
Answers (1)
  1. 29 March, 06:55
    0
    The approximate monthly interest rate = 2%

    Explanation:

    The approximate monthly interest is calculated by dividing the annual (12-month) percentage rate by 12.

    The idea is, if a total of 26% accounts for the interest for 12 months, therefore, the interest for 1 month = 26 : 12 = 2.167 %. but since we are asked to approximate, the answer will be 2%.

    Credit card users on using their credit cards, borrow money from the credit card companies with certain interests that are mostly charged daily, called Daily Periodic Rates, or calculated monthly as in this case, and such calculations are made from the Annual Percentage rate stated in the agreement. The interest is effectively calculated as Daily periodic rate * Average daily balance (debt carried over daily) * billing period.
Know the Answer?
Not Sure About the Answer?
Get an answer to your question ✅ “Mia received a credit card offer in the mail. The credit card has an annual percentage rate of 26%. What is the approximate monthly ...” in 📙 Business if there is no answer or all answers are wrong, use a search bar and try to find the answer among similar questions.
Search for Other Answers
You Might be Interested in
By diversifying, the risk of holding stock a. can be reduced but not eliminated. On average over the past two centuries stocks paid a lower average real return than bonds. b. can be eliminated.
Answers (1)
Barton Health Services provided care to a patient worth $1,200. Because the patient was over the age of 65, Barton granted the patient a 20% discount and the customer paid the correct amount in cash.
Answers (1)
Is a risk neutral person likely to make a fair bet? A. No. Risk neutral individuals are indifferent about making a fair bet. B. Yes. Risk neutral individuals are unwilling to make a fair bet. C. No.
Answers (1)
Gillian is consuming her optimal consumption bundle of peanuts and raisins. The marginal utility associated with the last peanut she consumes is 4 utils, and the marginal utility associated with the last raisin is 2 utils.
Answers (1)
What is the most challenging when it comes to keeping a monthly budget?
Answers (2)
New Questions in Business
Which magazine published the article "The Rise of Crowdsourcing" in 2006? A) Forbes B) Wired C) Time D) EWeek correct answer: B, Wired
Answers (1)
Calculating and Interpreting EPS Information Wells Fargo reports the following information in its 2015 Form 10-K.
Answers (1)
Explain the differences in working cultures in the U. S. verses Japan. How is leadership affected? Minimum of 100 words
Answers (1)
ABC Industries contracts to sell to CBA Industries 10,000 widgets a month for the next two years. A month after entering into the contract, a labor dispute between ABC and its employees arises and all production ceases.
Answers (1)
Ayayai Company includes one coupon in each box of soap powder that it packs, and 10 coupons are redeemable for a premium (a kitchen utensil).
Answers (1)
Home » Business » Mia received a credit card offer in the mail. The credit card has an annual percentage rate of 26%. What is the approximate monthly interest rate that will apply to any unpaid balances on this credit card? Assume 12 equal months.
Sign Up Forgot Password?