what is the amount of interest charged for the first 6 months? this table can be used to organize gigis…

what is the amount of interest charged for the first 6 months? this table can be used to organize gigis credit card balances and payments over 6 months. the annual percentage rate on the credit card is 14%. gigis credit card payments\n\n| month | 1 | 2 | 3 | 4 | 5 | 6 |\n|--|--|--|--|--|--|--|--|\n| balance | $650 | $354.08 | $307.63 | $260.64 | $213.10 | $165 |\n| payment | $300 | $50 | $50 | $50 | $50 | $50 |\n| interest rate | 0.01167 | 0.01167 | 0.01167 | 0.01167 | 0.01167 | 0.01167 |\n| interest charged | $4.08 | | | | | |

what is the amount of interest charged for the first 6 months? this table can be used to organize gigis credit card balances and payments over 6 months. the annual percentage rate on the credit card is 14%. gigis credit card payments\n\n| month | 1 | 2 | 3 | 4 | 5 | 6 |\n|--|--|--|--|--|--|--|--|\n| balance | $650 | $354.08 | $307.63 | $260.64 | $213.10 | $165 |\n| payment | $300 | $50 | $50 | $50 | $50 | $50 |\n| interest rate | 0.01167 | 0.01167 | 0.01167 | 0.01167 | 0.01167 | 0.01167 |\n| interest charged | $4.08 | | | | | |

Answer

Explanation:

Step1: Recall the interest - calculation formula

The monthly interest rate $r$ is calculated from the annual percentage rate (APR). Given APR = 14%, so the monthly interest rate $r=\frac{14%}{12}\approx0.01167$. The interest charged each month is calculated as $I = r\times\text{Balance}$.

Step2: Calculate the interest charged for each month

  • Month 1: Balance = $650$, Interest charged $I_1=0.01167\times650 = 7.5855\approx7.59$
  • Month 2: Balance = $354.08$, Interest charged $I_2=0.01167\times354.08\approx4.13$
  • Month 3: Balance = $307.63$, Interest charged $I_3=0.01167\times307.63\approx3.59$
  • Month 4: Balance = $260.64$, Interest charged $I_4=0.01167\times260.64\approx3.04$
  • Month 5: Balance = $213.10$, Interest charged $I_5=0.01167\times213.10\approx2.49$
  • Month 6: Balance = $165$, Interest charged $I_6=0.01167\times165\approx1.93$

Step3: Sum up the interest charged for 6 months

$I = I_1 + I_2+I_3+I_4+I_5+I_6=7.59 + 4.13+3.59+3.04+2.49+1.93 = 22.77$

Answer:

$22.77$