Question

If cameron has a 21% annual interest rate on his credit card, what is his monthly interest rate?

Answer 1

Given that Cameron has a 21% annual interest rate on his credit card, his monthly interest rate is given by:


`i= (\left(1+(0.21)/(12))^(12)-1)/(12) \\ \\ =(\left(1+0.0175)^(12)-1)/(12) \\ \\ =(\left(1.0175)^(12)-1)/(12) =(1.231439-1)/(12) \\ \\ = (0.231439)/(12) =0.019287\approx\bold{1.93\%}`