If a musician uses his credit card to pay for a new violin that costs $2,900 and does not pay on it until the second month, what will the 3.35% monthly interest charge be at the end of the first month? Show your work or explain how you got your answer.

Answer 1

To calculate the interest charge on the credit card for the first month, you start with the balance of $2,900 and apply the monthly interest rate, which is 3.35%.

Here's the step-by-step calculation:

1. Determine the monthly interest rate:

   • The monthly interest rate is given as 3.35%, which can be expressed as a decimal.
   • \[ \text{Monthly interest rate} = \frac{3.35}{100} = 0.0335 \]

2. Calculate the interest charge for the first month:

   • To find the interest charged at the end of the first month, multiply the balance by the monthly interest rate.
   • \[ \text{Interest charge} = \text{Balance} \times \text{Monthly interest rate} \]
   • \[ \text{Interest charge} = 2900 \times 0.0335 \]

3. Perform the multiplication:

   • \[ \text{Interest charge} = 2900 \times 0.0335 = 97.15 \]

Thus, the interest charge at the end of the first month will be $97.15.