Question
if the billing cycle length for a credit card is one calendar month, which of the following months will result in the lowest periodic interest rate?
november
june
april
february
november
june
april
february
Answers
GPT-4o mini
The periodic interest rate for a credit card is typically calculated based on the annual interest rate divided by the number of billing cycles in a year. Since each month has the same number of days (either 28, 30, or 31), the periodic interest rate does not vary significantly from month to month based on the length of the month.
However, February is the only month that consistently has fewer days (28 in common years and 29 in leap years). If we consider a month with fewer days, it might lead to a slightly lower interest amount if you were charged interest using a daily calculation method for that month, since interest is accrued based on the number of days in that period.
Therefore, **February** will result in the lowest periodic interest rate due to having fewer days in the billing cycle, and thus less interest accruing if calculated daily.
However, February is the only month that consistently has fewer days (28 in common years and 29 in leap years). If we consider a month with fewer days, it might lead to a slightly lower interest amount if you were charged interest using a daily calculation method for that month, since interest is accrued based on the number of days in that period.
Therefore, **February** will result in the lowest periodic interest rate due to having fewer days in the billing cycle, and thus less interest accruing if calculated daily.