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Present value problem

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You charged $2400 on your credit card for holiday gifts. Your credit card company charges you 8% annual interest, compounded monthly. If you make the minimum payments of $75 per month, how long will it take (to the nearest month) to pay off your balance?
Answer
80 months
48 months
24 months
36 months

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Solution Summary

This solution helps calculate present value.

Solution Preview

We use the annual formula to solve this question.

The annuity formula states

Present value = ...

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