Question

Question
You take out a cash advance of $1,670.00 on a credit card with a 2% cash advance fee and a 13.5% APR. What is the amount due by the end of the month?
(1 point)
Responses

$1,722.56
$1,722.56

$1,933.36
$1,933.36

$1,703.40
$1,703.40

$1,895.45

Answer 1

2% fee = 0.02 × $1,670 = $33.40
Balance after fee = $1,670 + $33.40 = $1,703.40
Monthly interest = 13.5%/12 = 1.125% = 0.01125
Interest = $1,703.40 × 0.01125 = $19.16
Total due = $1,703.40 + $19.16 = $1,722.56

Answer: $1,722.56