Debit Cards, Credit Cards & Pay Day Loans
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Copy and paste the questions below into a google doc or an email to send to me at [email protected]
This is Due on May 1st Video 1 - DEBIT vs. CREDIT CARDS
Video 2 - PAYDAY LOANS
Exercises 1: The Cost of Borrowing Case Study Jennifer, an 18 year old high school student, was at the mall and was asked if he would like a credit card that would save her ten cents on every litre of gas. Jennifer thought that this sounded reasonable because she borrowed the family car once in a while and filled it up with gas. Jennifer applied for the card and was approved for a $500.00 limit. The interest rate on the credit card was 22%. After she received her new credit card, Jennifer made several purchases totaling $332.54. Jennifer’s hours at her part time job were cut back the next month and she could only afford to make the minimum payment of $10.00 a month. Using this link to the debt-calculator, complete the chart below by determining the number of months it would take Jennifer to pay off her credit card and the total interest paid at the various payment rates. Payment Rate # of Months Interest Paid Payment of $10.00 Payment of $20.00 Payment of $30.00 A. Financially, why would it be better for Jennifer to pay $30.00 per month vs $10.00 per month? B. How much interest would Jennifer save by paying $20.00 a month rather than $10.00? C. How much interest would Jennifer save by paying $30.00 a month rather than $10.00? D. What advice would you have for Jennifer about the use of credit cards? |