Question

Try to solve this problem without a calculator in order to fine tune your financial skills. You are considering joining BJs discount club, and the annual fee is $45. You expect that you will save 10% on your BJ purchases compared to your current "non-club" stores. How much do you have to spend at BJs in order to break even on your annual fee (i.e. save an amount equal to the fee)?

Answer 1

To break even on the annual fee, you would need to spend $450 at BJ's.

Step-by-step explanation:

To calculate how much you need to spend at BJ's in order to break even on the annual fee, you can set up an equation. Let x be the amount you spend at BJ's.

According to the problem, you will save 10% on your BJ purchases compared to your current stores.

So, the amount saved is 0.10x. The equation can be written as:

0.10x = $45

To find x, you divide both sides of the equation by 0.10:

x = $450

Therefore, you would need to spend $450 at BJ's in order to break even on the annual fee.

Answer 2

$450

Step-by-step explanation:

The break even point is the point where the amount you save is the same as the amount you have spent in the annual fee.

So Annual fee= $45

Save = x (amount spent) *0.1 (you save the 10% in every purchase)

then

$45=x*0.1=> x= 45/0.1= 450 U$S

I hope this was helpful. Have a nice day!