Jyn Erso purchased 3000 worth of furniture on January 1 2017

Jyn Erso purchased $3,000 worth of furniture on January 1, 2017 and charged it to her VISA credit card account. Her VISA card charges interest at 2% per month compounded monthly. If the $3,000 purchase is the only purchase she makes using her card during the month of January, how much will she owe on January 31, 2017? Show your calculations.

Solution

Note that interest rate is compounded monthly and the interest rate per month is 2%. Hence the effective rate of interest is 2%. Now the only purchase is $3000. Thus, the required amount owed at the end of January of the same year is given by A = 3000 + 3000*2%. = $3060.