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If Simon only uses the card for the minimum payment each monthly payments and doesn't make any more purchases, it will take him 50 months to pay it off. Decide on the closest month.
If you enter the loan's total amount, the number of minimum payment it will take to be repaid, and the annual interest rate, the Monthly Payment Calculator will provide the monthly payment for any loan.
Debt service or another obligation that must be paid on a regular basis. Mortgage payments and wages for some employees are a few of examples of monthly payments.
Using this formula
PV of Annuity = Monthly Payment * [{1 - (1 + r)-n} / r]
Where,
PV of Annuity =$350
Monthly Payment =$10
r=(0.18/12)
Let plug in the formula
$350 = $10 * [{1 - (1 + 0.18/12)-n} / (0.18/12)]
$350 / $10 = {1 - (1.015)-n} / 0.015
35 * 0.015 = 1 - (1.015)-n
(1.015)-n = 1 - 0.525
-n[log(1.015)] = log(0.475)
-n[0.0149] = -0.7444
n = -0.7444 / -0.0149
n= 50 months
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The complete question is
Simon recently received a credit card with an 18% nominal interest rate. With the card, he purchased an Apple iPhone 11 for $740. The minimum payment on the card is only $20 per month.
If Simon makes the minimum monthly payment and makes no other charges, how many months will it be before he pays off the card?
