Last month,the ending balance on Maryanne's MasterCard was $1,789,the average daily balance was $755,and the monthly periodic rate is 1.85%.Her finance charge can be calculated by multiplying the ending balance times the monthly periodic rate.So the finance charge is $1,789  0.0185 = $33.10.

Question

Last month,the ending balance on Maryanne's MasterCard was $1,789,the average daily balance was $755,and the monthly periodic rate is 1.85%.Her finance charge can be calculated by multiplying the ending balance times the monthly periodic rate.So the finance charge is $1,789    0.0185 = $33.10.

sanele gabuza · Accepted Answer

Final Answer : False, Explanation :  The finance charge should be calculated using the average daily balance, not the ending balance. Therefore, the correct calculation would be $755 * 0.0185 = $13.96.

Last month,the ending balance on Maryanne's MasterCard was $1,789,the average daily balance was $755,and the monthly periodic rate is 1.85%.Her finance charge can be calculated by multiplying the ending balance times the monthly periodic rate.So the finance charge is $1,789  0.0185 = $33.10.

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