To find the monthly finance charge, we need to use the given average daily balance, daily periodic rate, and the number of days in the billing cycle. Here’s the step-by-step process:
1. Identify the given data:
- Average daily balance: \[tex]$20
- Daily periodic rate: 0.04%
- Number of days in the billing cycle: 30
2. Convert the daily periodic rate to a decimal:
- The daily periodic rate in percentage is 0.04%. To convert it to a decimal, divide by 100.
- \( 0.04 \div 100 = 0.0004 \)
3. Multiply the average daily balance by the daily periodic rate:
- \( 20 \times 0.0004 = 0.008 \)
4. Multiply the result by the number of days in the billing cycle:
- \( 0.008 \times 30 = 0.24 \)
Therefore, the monthly finance charge is \$[/tex]0.24.
Hence, the correct answer is:
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None of the above answers (A, B, or C) are correct.
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