Michael Has a Credit Card Debt of $60,000 That Has

question 104

Multiple Choice

Michael has a credit card debt of $60,000 that has a 10% APR, compounded monthly. The minimum monthly payment only requires him to pay the interest on his debt. He receives an offer for a credit card with an APR of 9% compounded monthly. If he rolls over his debt onto this card and makes the same monthly payment as before, how long will it take him to pay off his credit card debt?

• A) 298 months
• B) 299 months
• C) 306 months
• D) 308 months

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Definitions:

Tax Cases

These are legal cases that deal with the interpretation and application of tax laws, resolved in various courts, including Tax Court, Federal District Courts, and the Supreme Court.

U.S. Tax Court

A federal court that provides taxpayers a forum to dispute tax deficiencies assessed by the IRS before paying the disputed amount.

Tax Rate Structure

A scheme that defines how tax rates progress based on variables such as income level, corporate profits, or other bases.

Proportional

Relating to a relationship between variables where they increase or decrease at the same rate.