Question

Use the following information to determine the amount of interest owed.
Interest rate: 9%
Amount owed at the end of each day in the billing cycle: $100
Number of days in billing cycle: 31

A.
$2.61

B.
$29.03

C.
$31.90

D.
$9.00

Answer 1

Use the average‑daily‑balance formula:

Finance charge = average daily balance × (APR/365) × number of days

= $100 × (0.09/365) × 31
≈ $100 × 0.0002466 × 31
≈ $0.76

So the interest owed is about $0.76 (or $0.75 if you use APR/12). None of the given choices (A–D) match.