1. 4.4B Credit Cards

2. Vocabulary Review
IMPULSE BUYING: When a consumer purchases something to which they suddenly were attracted to.
CHARGE CARD: A special type of credit card that allows the cardholder to make purchases in places that accept the card. The monthly bill must be paid in full.
TRUTH IN LENDING ACT: Protects you if your credit card is lost or stolen.
CREDIT CARD: A plastic card that entitles its holder to make purchases and pay for them later.

3. Example One
Credit card companies issue a monthly statement; therefore APR must be converted to a monthly percentage rate. If the APR is 27.9%, what is the monthly interest rate?

4. Example Two
Rebecca pays a finance charge on her average daily balance of $1, Her APR is 18%. What is her finance charge for this billing cycle?

5. Example Three
Austin pays a finance charge on his average daily balance of $ His APR is 21%. What is his finance charge for this billing cycle?

6. Example Four
Jake had these daily balances on his credit card for his last billing period. He did not pay the card in full the previous month, so he will have to pay a finance charge. The APR is 18.6%.
Two $331.98
Eleven $1,203.04
Four $996.71
Thirteen $1,002.76
What is the average daily balance?
What is the finance charge?

7. Example Four Continued