Basic - Calculating Interest + Time Till Pay off

Hey guys,

I feel like is a relatively easy question. I think I've done it correctly but I just want to check with you guys before I submit the assignment. I've uploaded my spreadsheet. I asked my professor if our formula had to take into account whether or not our payment would be changing. As long as I calculated the initial amount - which worked out to be around 30 dollars, I could assume I paid that amount for the entirety. I guess next week's assignment is a little trickier.

P.S. Thanks for the help. I'll run around a few topics and try to assist in areas I'm familiar with to return the favor.




ASSIGNMENT 4


My latest Mastercard statement shows a balance due of $1,696.96.

Based on recent bills, assume that the minimum payment amount is computed as follows
(balance_owed)*(annual_interest_rate/12) * 2, then rounded to the nearest whole dollar amount.

The minimum payment amount is the amount calculated above or $25.00, whichever is the greater amount.

The annual interest rate for purchases is 11.24%. If I make no more purchases and always pay my bill on time how many years and months will it take be pay it off at the current minimum payment amount each month?

How much total interest would I pay if I repay the loan this way?

What fixed monthly payment amount would pay off the debt in 2 years?

Assume monthly compounding of interest. All calculations are to be done in the Excel worksheet.
Hint: the functions NPER() and PMT() will be helpful. Note that either the Present Value or Payment amount should be negative (not both) because of conventions concerning the direction of cash flow."

Originally Posted by shg

Based on recent bills, assume that the minimum payment amount is computed as follows

(balance_owed)*(annual_interest_rate/12) * 2, then rounded to the nearest whole dollar amount.

Is there a way to incorporate the round function into the formula? I couldn't figure that out. Thank you for pointing that out.