Calculating Minimum Monthly Payments

The video tutorial guides viewers through modifying a spreadsheet to calculate minimum monthly payments on a credit card balance. It begins by deleting unnecessary columns and setting up a new column for minimum payments, calculated as a percentage of the balance. The tutorial explains how to adjust formulas to reflect these changes and demonstrates dragging formulas to apply them across multiple months. It highlights the issue of increasing balances despite payments and encourages viewers to explore different percentage rates and their effects on the balance.

What is the main goal of changing the spreadsheet in the tutorial?

• To calculate the annual interest rate

• To add more columns to the spreadsheet

• To switch from fixed to minimum monthly payments

• To increase the monthly payment amount

What is the first step in modifying the spreadsheet?

• Increasing the balance amount

• Deleting column D

• Changing the spreadsheet format

• Adding a new column for interest rates

What does the teacher do after deleting column D?

• Deletes the 150 value

• Adds a new row for annual payments

• Changes the spreadsheet color

• Increases the interest rate

How is the minimum monthly payment calculated according to Investopedia?

• As a percentage of the total credit balance

• As a fixed amount each month

• Based on the annual income

• Using the previous year's balance

What percentage of the balance is used to calculate the minimum monthly payment in the example?

• 0.5%

• 2%

• 1%

• 1.5%

What is the initial balance set at in the spreadsheet?

• $7,200

• $5,000

• $6,600

• $8,000

What does the teacher suggest about the order of credit card company calculations?

• It is fixed by law

• It is based on annual income

• It varies and is not exactly known

• It is always the same

What is the teacher's approach to calculating the minimum payment?

• Using a fixed amount

• Using a percentage of the balance

• Based on annual income

• Using a random value

What happens to the balance after adding 1.5% and subtracting the minimum payment?

• It increases

• It doubles

• It decreases

• It remains the same

What is the interest rate added to the balance each month?

• 2.5%

• 1%

• 1.5%

• 2%