Question

12.
Use the following information to determine the amount of interest owed.
Interest rate: 19%
Amount owed at the end of each day in the billing cycle: $50
Number of days in billing cycle: 30

A.
$9.50

B.
$5.50

C.
$19.50

D.
$1.50

Answer 1

A. $9.50

(That comes from 50 × 0.19 = 9.50. If instead 19% is an annual rate, the correct 30-day interest would be 50 × 0.19 × 30/365 ≈ $0.78.)