You have $450.00 each month to pay off these two credit cards. You decide to pay only the interest on the lower-interest card and
the remaining amount to the higher interest card. Complete the following two tables to help you answer questions 1-2.
Higher-Interest Card (Payoff Option)
1
$1,007.24
$8.23
$447.73
Month
Principal
Interest accrued
Payment (on due
date)
End-of-month
balance
Lower-Interest Card
Month
Principal
Interest accrued
Payment (on due
date)
End-of-month
balance
$567.74
1
$445.81
$2.27
$2.27
$445.81
2
$567.74
2
$445.81
3
3
5
5