If a Credit Card Company Has a 20-Day Grace Period

Multiple Choice

If a credit card company has a 20-day grace period and an interest rate of 20 percent, how much interest will be charged on a $5000 balance which gets paid 40 days after the due date using the average daily balance method?

A) $164.38
B) $109.59
C) $126.69
D) $83.33