Question

A credit card gives 2% cash back on purchases. You purchase $1,685.90 in items with that card.If the credit card in problem #3 has an interest rate of 14.75% and you do not make a payment the first month on that $1,685.90 balance, how much is the difference between the interest and reward?
(1 point)
Responses

$17.91
$17.91

$88.51
$88.51

$13.00
$13.00

$32.31
$32.31

Answer 1

Interest for one month = 1685.90*(0.1475/12) = 1685.90*0.0122916667 ≈ $20.72
Cash back = 0.02*1685.90 = $33.72
Difference = 33.72 − 20.72 ≈ $13.00

Answer: $13.00