Personal Finance 1st Edition by Jack R. Kapoor

Exercise 12

1.    Distinguish between the finance charge and the annual percentage rate.

2.      What are the three variations of the simple interest formula?

3.      Distinguish among the adjusted balance, previous balance, and average daily balance methods of calculating the cost of open-end credit.

4.      What is the rule of 78s?

Step 1 of 3

2. Simple interest on the declining balance, add-on interest, bank discount, and compound interest are variations of simple interest.