Solve the Problem The Interest Rate on the Card Is 1

question 48

Multiple Choice

Solve the problem.
-On the July 5 billing date, David had a balance due of $857.86 on his credit card. The transactions During the following month were: $$\begin{array} { l l l } \text { July } 6 & \text { Payment } & \$ 278.43 \\\text { July 19 } & \text { Charge: auto repair } & \$ 316 \\\text { August } 1 & \text { Charge: clothing } & \$ 157.38\end{array}$$
The interest rate on the card is 1.8% per month. Using the average daily balance method, find the Finance charge on August 5 (July has 31 days) .

• A) $14.08
• B) $13.89
• C) $13.37
• D) $13.91

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Definitions:

Herfindahl Index

A measure of market concentration used to determine the competitive landscape by summing the squares of the market shares of all firms in the industry.

Market Shares

The segment of a market dominated by a specific company or product, usually represented as a percentage.

Concentration Ratio

A measure of the total output produced in an industry by a given number of firms, usually the largest in the industry, indicating the level of market competition.

Product Differentiation

The approach of making a product or service stand out from competitors in the marketplace to appeal more to a specific target audience.