Question

megs credit limit is $8000. she currently has a balance of $800. if she makes a purchase that increases her utilization ratio by 20%, what would be her account balance?

Explanation:

Step1: Find initial utilization ratio

Initial balance = $800, credit limit = $8000.
Utilization ratio = $\frac{800}{8000} = 0.1$ (or 10%).

Step2: Calculate new utilization ratio

New ratio = 10% + 20% = 30% (or 0.3).

Step3: Find new balance

Let new balance be $x$.
$\frac{x}{8000} = 0.3$
$x = 0.3 \times 8000 = 2400$.

Answer:

\$2400