Question

The opening balance of one of the billing cycles for Rusty's credit card was $603. If he makes a payment during the billing cycle but doesn't make any new purchases, which of these is an accurate statement?
A. Rusty will pay less interest with the adjusted balance method and the average daily balance method, but not with the previous balance method.
B. Rusty will pay less interest with the average daily balance method, but not with the adjusted balance method or the previous balance method.
C. Rusty will pay less interest with the average daily balance method and the previous balance

Answer 1

Rusty will pay less interest with the adjusted balance method and the average daily balance method, but not with the previous balance method.

Answer 2

Answer:

The answer is: A. Rusty will pay less interest with the adjusted balance method and the average daily balance method, but not with the previous balance method.

Explanation:

Average daily balance: This is the most commonly used method. Your credit card issuer calculates your balance each day in the billing cycle. Each day, they add new charges and subtract payments from their existing balance.

Adjusted balance: With this method you will normally pay less in interest than with other methods.

Previous balance: With this method, the credit card issuer charges interest on the initial account balance. This means that you will pay more in interest compared to the Adjusted Balance method.

The answer is: A. Rusty will pay less interest with the adjusted balance method and the average daily balance method, but not with the previous balance method.