Chip has a $50.00 balance on his credit card. Since he didn't pay it off, he will be charged a 20% interest fee. He puts $20.00 on his credit card the following month and doesn't make any payments to his debt. He is hit with another 20% interest fee. What's the current balance on his credit card? Let's think first. Chain of thought:
He has a balance of $50.00 and is charged 20% interest so that's 50 * .20 = $10.00. He had a balance of $50.00 and now has a $10.00 interest fee making his balance 50 + 10 = $60.00. His balance is $60.00 and he puts another $20.00 on his card for a total of 60 + 20 = $80.00. He didn't make a payment that month and is hit with another 20% interest fee so that's 80 * .20 = $16.00 in interest. His new balance is 80 + 16 = $96.00.
Therefore, the answer is 96.