With only a part-time job and the need for a professional wardrobe, Rachel quickly maxed out her credit card the summer after graduation. With her first full-time paycheck in August, she vowed to pay $280 each month toward paying down her $9,928 outstanding balance and not to use the card. The card has an annual interest rate of 12 percent. How long will it take Rachel to pay for her wardrobe?
Should she shop for a new card? Why or why not?
• Note: Round intermediate computations to at least five (5) decimal places.

a) If Rachel continues to pay $280 per month, it will take her months to pay for her wardrobe. (Round to the nearest month.)

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b) Should she shop for a new card? Why or why not? (Select the best answer below.)

• A. As a typical credit user, Rachel might consider finding a card with the lowest possible interest rate and doing a balance transfer. If a new, lower interest card would be her only new credit, she could save interest and possibly increase her credit score because her $9,928 balance would represent a lower percentage of her total available credit. However, she should be cautious of acquiring too much new credit or of closing the existing account both factors could lower her credit score
• B. As a typical credit user, Rachel might consider finding a card with the lowest possible interest rate and doing a balance transfer. If a new, lower interest card would be her only new credit, she could save interest and possibly increase her credit score because her $9,928 balance would represent a lower percentage of her total available credit. She would not need to be cautious of acquiring too much new credit or of closing the existing account neither factor would lower her credit score.