Question

You take out a cash advance of 2,790.00on a credit card with a 3.5% cash advance fee and a 13%apr (adjust for monthly rate) what is the amount due by the end of the month

Answer 1

$2,920.14

Explanation:

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Answer 2

Given that the credit card has a 3.5% cash advance fee. The the cash advance fee on a cash advance of $2,790.00 is given by


`0.035*\$2,790=\$97.65`

Given that the card has an APR of 13%, the value of the cash advance at the end of the month is given by


`FV=2790(1+0.13)^{ (1)/(12) } \\ \\ =2790(1.13)^{ (1)/(12) }=2790(1.0102) \\ \\ =\$2,818.56`

Therefore, the amount due at the end of the month is given by $2,818.56 + $97.65 = $2,916.21