PromptWhy is the annual interest rate more important to a borrower who carries a balance than to a borrower who pays off the bal...

4 answers
Question:

Prompt Why is the annual interest rate more important to a borrower who carries a balance than to a borrower who pays off the bal...

Answers

Interest to be paid will keep on reducing each month due to reduction of the principal amount.As a result the net interest outgo will be higher for a borrower who carries balance for the whole year compared to one who pays offs monthly.

Step-by-step explanation:

The interest outgo for any balance depends on 3 things:

Principal amountDuration of the borrowingAnnual Interest Rate

In case of borrower who carries the balance, the annual interest is:

[tex]\[\frac{Principal\times 1 \times Rate}{100}\][/tex]

On the other hand, a borrower who pays the balance monthly,will have a reducing balance on which interest in computed each month. For example,

Month 1 : Interest is computed on entire amount P

Month 2: Interest is computed on [tex]\[Principal - \frac{Principal}{12}\][/tex]

Month 3: Interest is computed on [tex]\[Principal-\frac{2 \times Principal}{12}\][/tex]

and so on.

So the interest to be paid will keep on reducing each month due to reduction of the principal amount.

As a result the overall interest outgo at the end of the year will be less compared to the borrower who carries the balance.

Step-by-step explanation:

Who is paying is not as important as the interest rate. Either way, a lower rate will benefit the person who has the bill.

the transverse axis of a hyperbola is the line that contains the two vertices and the two focuses.

in this example (hyperbola of equation x^2/2 - y^2/4 = 1), the transverse axis is the  x-axis  . 

step-by-step explanation:

[tex]Which of the following statements best describes the transverse axis of a hyperbola?[/tex]

the answer is su.k.my? ? co.kc

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