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In other words, the interest is calculated daily on the balance for that day
Interest Based on Previous Balance Method $8.00
Previous Balance Method: With this method, interest charges are calculated on the previous monthly balance and before purchases and/or payments are placed on the bill. The caution with this method is that if your previous balance was zero, you would have no interest charge for this month.
Interest based on the adjusted balance method $5.33
Adjusted Balance Method: This is the least expensive method for consumers. In this method, any payments or credits during the month are subtracted from the previous month's balance before the interest is calculated...
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