You have just graduated from college and purchased a car for $5000. Your credit limit is $10,000. Assume that you make no payments and purchase nothing more and that there are no other fees. The monthly interest rate is 8%. What is the growth rate of your credit card balance per month (as a decimal)?

The monthly growth rate is the monthly interest rate written as a decimal. An 8% monthly rate is 8 ÷ 100 = 0.08, so the balance grows by 0.08 of its current amount each month. The $5,000 balance and $10,000 credit limit do not change the growth rate. The correct choice is 0.08.

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