You just got a new Credit Card - Yippeee! The card has a 24.9% interest rate and a really cool MTV logo. You went shopping and ran up a Balance of $5000!
How much do you have to pay back?
Create a spreadsheet that will show you exactly how much will you have to pay if you spread out your payments for; 1 year, 2 years, 3 years, 4 years, 5 years.
Do make sure you have linked last weeks travel budget into Moodle.
Watch the Video Below and answer the 3 questions about borrowing money.
Borrowing Money in Plain English
- What do banks get in return for giving you money?
- What does APR stand for?
- When talking about a loan what does word term mean?
You just got a new Credit Card - Yippeee! The card has a 24.9% interest rate. You went shopping and ran up a Balance of $5000!
Now reality hits you have to pay all this back.
Create a spreadsheet that will show you exactly how much will you have to pay if you spread out your payments for; 1 year, 2 years, 3 years, 4 years, 5 years.
Video Link
Using the =PMT(rate, NPER, PV, FV, type) function
A Credit Card balance of just $5,000 with 19.99% APR
How much interest will you be forking over for each term?
What is the total purchase price for all the good stuff you bought for $5000.
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