Niki & Jacob
What does APR stand for?
how to figure out monthly rate?
ARP High or low?
principal rate and time all represent?
4 ways finance charges can be calculated
2.Average daily balance-The average daily balance method uses the average of your balance during the billing cycle. Each day's balance is added together and divided by the number of days in the billing cycle This is the most common way finance charges are calculated.
3.Double billing cycle-The double billing cycle uses the average daily balance of the current and previous billing cycles. This is the most expensive way finance charges are calculated. Fortunately for credit cardholders, the double billing cycle method of calculating finance charges is now against the law.
4. Ending balance-The ending balance method uses your beginning balance minus payments plus charges made during the billing cycle. The number of days in the billing cycle doesn't affect the amount of the finance charge.