Question

Pick is below this is not a TEST or QUIZ its a homework

Answer 1

Option 2

Step-by-step explanation

The cost of the Playstation is $450.

OPTION 1

6 months at 3% interest.

We have to split the amount into 6 and then find 3% of that and add it to the monthly price.

That is:

450 / 6 = $75

Amount per month is therefore:

`\begin{gathered} A\text{ = }(3)/(100)\cdot75\text{ + 75} \\ A\text{ = }2.25\text{ + 75 = \$77.25} \end{gathered}`

OPTION 2

12 months at 5% interest.

Split into 12 instead of 6 and use 5%.

We have:

450/12 = $37.5

`A\text{ = }(5)/(100)\cdot37.5\text{ + 37.5 = 1.875 + 37.5 = \$39.}38`

Therefore, option 2 has the smallest monthly payment.