Question

A credit card billing cycle is 15 days. You started your billing cycle with a balance of $500. On Day 7, you made a $400 purchase. On Day 12, you made a $700 payment to your account. If no other transactions are made until the end of your billing cycle, what is your average daily balance on day 15?
A- $453.53
B- $353.35
C- $553.33
D- $535.55

Answer 1

To find the average daily balance on day 15, we need to calculate the balance for each day in the billing cycle, then divide by the number of days in the cycle.

Day 1-6: Balance = $500
Day 7-11: Balance = $500 + $400 = $900
Day 12-15: Balance = $900 - $700 = $200

To find the average daily balance, we add up the balances for each day and divide by 15:

(6 days x $500) + (5 days x $900) + (4 days x $200) = $3,600

$3,600 / 15 days = $240 average daily balance

Therefore, the correct answer is not listed.

Answer 2

but which one do I choose

Answer 3

Since the correct answer is not listed, you could choose the answer that is closest to the calculated average daily balance of $240.

The closest option is B- $353.35, which is lower than the actual average daily balance.