Suppose your MasterCard calculates interest using the average daily balance method, and the monthly interest rate is 1.9%. The itemized billing for the month of August is shown below The average daily balance has already been computed and is $2739.52. (a) Find the interest due for this month. $ (b) Find the total balance owed on the last day of the billing period. $ (c) This credit card requires a $15 minimum payment or 1/24 of the amount due, whichever is higher. What is the minimum monthly payment due for this month?

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Effective Interest Rate

The term interest rate can be defined as the amount that is charged by the lender as a percentage on the principal amount. Interest rate which is charged annually is known as annual percentage rate.