Exploring Average Daily Balance Concepts

The video tutorial guides students through an example to help with an assignment. It starts with setting up a calendar and calculating daily balances based on credit card transactions. The tutorial then demonstrates how to find the average daily balance using a spreadsheet. Finally, it explains how to calculate the finance charge using the average daily balance and the annual percentage rate (APR).

What is the APR mentioned in the example?

• 15%

• 20%

• 18%

• 16%

On which date was the first purchase made that changed the balance?

• November 1st

• November 3rd

• November 4th

• November 5th

What was the balance on November 6th?

• $250

• $390

• $265

• $290

How much was spent on November 20th?

• $150

• $3

• $100

• $2000

What was the balance at the end of November 23rd?

• $545

• $2548

• $540

• $2000

What method is suggested to calculate the average daily balance?

• Using a calculator manually

• Asking a friend

• Estimating visually

• Using a spreadsheet

What was the average daily balance calculated in the video?

• $870.43

• $873.43

• $875.43

• $878.43

How is the monthly interest rate derived from the APR?

• Divide by 100

• Divide by 12

• Multiply by 12

• Multiply by 100

What is the monthly interest rate if the APR is 16%?

• 0.1

• 0.016

• 0.0133

• 1.6

What was the finance charge calculated for the month?

• $12.61

• $13.61

• $10.61

• $11.61