Question

The Living Ocean Institute is an environmentally responsible organization, and your design includes solar panels on the roof to supply all the building's power requirements. The sales representative from the solar panel company tells you that the total retail cost is $90,000, but that the company offers a 10% discount as a sales promotion, plus a 5% discount on the final payment for full payment within 30 days. The sales representative claims the Living Ocean Institute will owe a total of $76,500 with both discounts taken.

Is the sales representative correct? Explain your answer.

Answer 1

Discounted Total = 90,000(0.90 - 0.05)

Discounted Total = 90,000(0.85)

Discounted Total = 76,500

This means that the sales representative is correct as the discounted total is $76,500.

Answer 2

To determine if the sales representative is correct, we can calculate the total cost of the solar panels after the two discounts.

First, the 10% discount reduces the cost by 10% of $90,000, or $9,000. The new cost after the first discount is $90,000 - $9,000 = $81,000.

Next, the 5% discount on the final payment will reduce the cost by an additional 5% of $81,000, or $4,050. The new cost after the second discount is $81,000 - $4,050 = $76,950.

Therefore, the sales representative's claim that the total cost after both discounts is $76,500 is incorrect. The correct total cost after both discounts is $76,950.

Explanation: