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# (Solved): Suppose Olivia has \$6,660 in credit card debt on the VB credit card which has annual interest rate o ...

Suppose Olivia has \$6,660 in credit card debt on the VB credit card which has annual interest rate of 18.8%. Olivia is considering transferring her debt to the LA credit card that offers 0% interest for 18 months. (a) If Olivia makes a payment of \$370 per month on the VB credit card, what will her balance be at the end of 18 months? Assume that no additional charges are made to the card. (Suggestion: You are trying to find the future value of a debt that has a present value of \$6,660. Use the formula for the future value of an ordinary annuity. Round your answer to the nearest cent.) \$ (b) If Olivia makes a payment of \$370 per month on the LA credit card, what will her balance be at the end of 18 months? Assume that no additional charges are made to the card. (Suggestion: None of the payment goes to interest on the debt. Round your answer to the nearest cent.) \$ (c) How much lower is the balance due after 18 months on the LA credit card? Note: Some credit card companies may charge a transfer fee which will affect the benefit of a 0% introductory rate. Assume that there is not a transfer fee. (Round your answer to the nearest cent.) \$

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