The cost of credit — Question 2

Now, let’s say you want to purchase $100 video games using a credit card. If you don’t pay the entire cost of the video games when the first bill comes, the bank will charge you interest. Let’s say you have budgeted $20 a month for the video games. How much interest will you have paid in 6 months?

Calculator

Video games and the cost of interest

Month Amount Owed Monthly Payment Interest Balance Due
1 105.00 20.00 0 85.00
2 85.00 20.00 1.31 66.31
3 66.31 20.00 1.08 47.39
4 47.39 20.00 .84 28.23
5 28.23 20.00 .60 8.83
6 8.83 8.83 .00 0