Solve the Problem The Interest Rate on the Card Is 1

question 175

Multiple Choice

Solve the problem.
-On the September 1 billing date, Martin had a balance due of $991.93 on his credit card. The Transactions during the following month were: $\begin{array}{llcc} \text {September 3 } \text {Payment }&\$92.95 \\ \text { September 9} \text { Charge: airline ticket } &\$505.27\\ \text { September 22 } \text { Charge: shoes } &\$71.36\\ \text { September 29 } \text { Charge: garden tiller} &\$210.16\\\end{array}$

The interest rate on the card is 1.4% per month. Using the average daily balance method, find the Finance charge on October 1 (September has 30 days) .

• A) $18.12
• B) $22.03
• C) $18.36
• D) $18.52

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Definitions:

Drawer

In banking, the person who writes or creates a check or draft instructing the bank to pay the stated amount to a third party.

Recourse

The legal right to demand a penalty, compensation, or satisfaction for a harm or loss.

Forged

Forged denotes something that has been counterfeit or fraudulently altered or replicated, such as a document, artwork, or signature.

Altered Check

A check that has been tampered with after its original issuance, often changing the name of the payee or the amount, with the intent to defraud.