To calculate the interest saved, we need to first calculate the interest charged for each payment amount.
Minimum payment:
Interest charged = (APR/365) * balance * 30
= (0.112/365) * 1945.61 * 30
= $18.96
New balance = balance + interest charged - minimum payment
= 1945.61 + 18.96 - 156
= $1,808.57
$156 paid towards principal.
Additional payment of $300:
Interest charged = (APR/365) * balance * 30
= (0.112/365) * 1945.61 * 30
= $18.96
New balance = balance + interest charged - total payment
= 1945.61 + 18.96 - 300
= $1,664.57
$456 paid towards principal.
Therefore, by paying an extra $144 towards the principal ($300 - $156), the interest saved for one month is:
$18.96 - $18.84 = $0.12
So, you save $0.12 in interest for one month.
You owe $1,945.61 on a credit card that has an 11.2% APR. the minimum payment due is $156.00 you decide to pay $300.00 goes much do you save in interest after one month by paying more than the minimum assuming you make the payment at the beginning of the month
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