Question

What type of credit involves a set number of payments at a set dollar amount for a fixed period of time?

What are the three methods of calculating balance charges on credit cards?

Answer 1

Installment Credit involves a set number of payments at a set dollar amount for a fixed period of time.

1. Adjusted balance method
2. Previous balance method
3. Average daily balance method

Hope this helps, have a blessed and wonderful day!

Answer 2

A loan is a type of credit that involves a set number of payments at a set dollar amount for a fixed period of time. When you take out a loan on something, you are agreeing to the amount of the loan and the terms that are set for repaying the lender back.

You can calculate the balance based on the daily balance method which sums up all of your finance charges for each day during the period. You can divide the APR by 365 to see the amount of interest that is paid daily. Lately, you can take the balance and multiple it by the per day interest to get the payment charges.