Question

tran has a credit card with a spending limit of $2000 and an apr (annual percentage rate) of 12%. during the first month, tran charged $450 and paid $150 of that in his billing cycle. which expression will find the amount of interest tran will be charged after the first month?

(0.01)($300)
(0.01)($450)
(0.12)($300)
(0.12)($450)

Explanation:

Calculate the remaining balance

Using the Order of Operations knowledge point

$$ \text{Remaining Balance} = \$450 - \$150 = \$300 $$

Find the monthly interest rate

The annual percentage rate (APR) is \(12\%\).
To find the monthly interest rate, divide the annual rate by \(12\) months:

$$ \text{Monthly Rate} = \frac{12\%}{12} = 1\% = 0.01 $$

Formulate the interest expression

Multiply the monthly interest rate by the remaining balance:

$$ \text{Interest Charged} = (0.01)(\$300) $$

Answer:

• (A) \((0.01)(\$300)\) (Correct answer)
• (B) \((0.01)(\$450)\)
• (C) \((0.12)(\$300)\)
• (D) \((0.12)(\$450)\)