Question

Tina purchased a new cell phone for $1,200, which she put on her credit card. At the end of the month she pays $300 of the balance. If the card charges 17% interest per month, what is the final balance after the first month?
$1,530
$1,630
$1,053
$1,330

Answer 1

To calculate Tina's final balance after the first month, we can follow these steps:

1. **Determine the initial balance**:
- Tina's initial balance is $1,200.

2. **Apply the interest for one month**:
- The interest rate is 17%, so we calculate the interest on the initial balance:
\[
\text{Interest} = \text{Initial balance} \times \text{Interest rate} = 1200 \times 0.17 = 204
\]

3. **Add the interest to the initial balance**:
- The new balance after adding the interest is:
\[
\text{New Balance} = \text{Initial balance} + \text{Interest} = 1200 + 204 = 1404
\]

4. **Subtract the payment made by Tina**:
- Tina pays $300:
\[
\text{Final Balance} = \text{New Balance} - \text{Payment} = 1404 - 300 = 1104
\]

Since $1,104 is not one of the answer options provided, let's verify the calculation again to ensure accuracy.

1. Initial amount = $1,200
2. Monthly interest = 17%
3. Interest for one month:
\[
1200 \times 0.17 = 204
\]
4. New balance after interest:
\[
1200 + 204 = 1404
\]
5. After payment of $300:
\[
1404 - 300 = 1104
\]

Again we confirm that the final balance is indeed $1,104.

It appears that none of the answer choices provided ($1,530, $1,630, $1,053, $1,330) are correct based on the calculations performed. It is possible that there has been an oversight in the options.