AW MATH 11 Unit : Financial Services Review Name



AW MATH 11 Unit : Financial Services Review Name:_____KEY______

1) Calculate the interest due on the following credit card balances:

a) An unpaid balance of $1629.53 at a rate of 19.50% for 21 days; and

a) $1629.53 x 0.195 x [pic] = $18.28

b) An unpaid balance of $2639.99 at a rate of 22.95% for 30 days.

b) $2639.99 x 0.2295 x [pic] = $49.80

2) Monique’s credit card charges interest of 20.85% per annum on unpaid balances.

On her March 12 statement, she had a balance of $739.65. By the due date, she

made the minimum payment (5% or $10.00, whichever is greater). On March 16,

she made a purchase of $179.39.

a) If she makes no other purchases or payments, what will her balance be on her

next statement, dated April 12?

a) Minimum payment = $739.65 x 0.05 = $36.98

balance after minimum payment = $739.65 – $36.98 = $702.67

interest on outstanding balance = $702.67 x 0.2085 x [pic] = $2.01

interest on a new total (with new purchase) = $882.06 x 0.2085 x [pic] = $13.10

New balance (next statement) = $882.06 + $2.01 + $13.10 = $897.17

b) On her April 12 statement, what will her minimum payment be?

b) $897.17 x 0.05 = $44.86

3) Harpreet took out a payday loan of $500.00. He had to repay $540.00

within 7 days.

a) What was the daily interest rate on the loan?

a) ($540 – $500) ÷ ($500 x 7) = 1.14%

b) What was the annual interest rate?

b) 1.14% x 365 = 416%

4) Nathaniel wants to buy a new bicycle. His payment options are:

Option 1: Pay $2055.99 cash. He only has $400.00 saved up, so he can take out a

loan for the rest from his bank at a rate of 7.25% per annum over 2 years.

Option 2: Take the store payment plan of 12 monthly payments of $180.00.

a) If he chooses Option 1, what will his monthly payments be?

a)

b) If he chooses Option 2, what annual rate of interest will he pay?

b)

c) Calculate the total cost of each option. Which option should he choose, and

why?

c) Option 1 = Option 2 =

He should choose Option 2.

5) The following table shows a list of the transactions on a single bank account for one month. If the account had an initial balance of $134.52, what is the new balance?

|Date |Amount |Type |

|03/02/11 |$90.94 |Withdrawal |

|07/02/11 |$1070.03 |Deposit |

|09/02/11 |$792.94 |Withdrawal |

|13/02/11 |$293.27 |Withdrawal |

|17/02/11 |$41.72 |Withdrawal |

|21/02/11 |$1034.51 |Deposit |

|22/02/11 |$302.13 |Withdrawal |

6) A customer has a credit card with a $2500.00 credit limit. If he purchases a blue ray player for $330.00 and a LED TV for $1199.00 on his card, what is his available credit?

7) Larry has an unpaid balance of $1900.00 on his credit card. The minimum payment is 3.3% or $20.00, which ever is more. What is Louis’s minimum payment?

8) The minimum monthly payment on Suhanna’s credit card is 3.5% of the unpaid balance. Suhanna pays the minimum of $98.60. What is her unpaid balance?

9) How much more interest would you pay in one year on a $3200.00 credit card balance if the interest rate was 22.50% instead of 16.90%?

10) On April 7, Luke purchased a flight for $3300.00 on his credit card. He had an unpaid balance on his credit card, so begins being charged interest from the date of purchase. If the credit card charges 19.00% interest annually, how much interest will Luke be charged on this purchase if he pays his bill on May 18?

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