As of November 14, Ben has an outstanding credit card balance of $1,100 from purchases made over the past month

The new billing period begins on November 15. Assume Ben's outstanding balance for the first 15 days of this new billing period (Nov. 15-29) is $1,100. Then on November 29, the financial institution receives a payment of $600 from Ben, reducing his balance to $500. This is the balance for the remaining 15 days.

Using the average daily balance method and a monthly interest rate of 2.5%, Ben's finance charge would be
A) $15.00.
B) $12.50.
C) $27.50.
D) $20.00.

Answer: D
Explanation: D) ($1100 + $500)/2 = $1600/2 = $800 × .025 = $20