coolcj96
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You have just graduated from college and purchased a car for $7000. Your credit limit is $12,000.  Assume that you make no payments and purchase nothing more and that there are no other fees. The monthly interest rate is 8%. What is the growth factor of your credit card balance?

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imcatchingfire1
1.08 is the answer. Hope I helped!
JeanaShupp

Answer: 1.08

Step-by-step explanation:

We know that the growth factor of credit card is given by :-

[tex]k=(1+r),\text{ where r is the monthly interest rate.}[/tex]

Given: The monthly interest rate = 8%

In decimal , the monthly interest rate is given by :-

[tex]r=\dfrac{8}{100}=0.08[/tex]

Now, the growth factor of your credit card balance is given by :-

[tex]k=(1+0.08)=1.08[/tex]

Hence, the growth factor of your credit card balance =1.08