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Credit card interest is typically calculated based on the average daily balance method. To calculate credit card interest, you can use the following formula:
Interest = Average Daily Balance x Daily Periodic Rate x Number of Days in Billing Cycle
Where:
- Average Daily Balance: This is the average of your outstanding balance each day during the billing cycle.
- Daily Periodic Rate: This is the annual percentage rate (APR) divided by the number of days in the year.
- Number of Days in Billing Cycle: This is the number of days in the billing cycle for which the interest is being calculated.
If you have specific numbers, you can plug them into this formula to calculate the interest amount.
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