Question

Seth has just decided to replace his computer. His old computer cost him $1,433 when he bought it exactly seven years ago. Seth paid for it with his credit card, which has an APR of 11.70%, compounded monthly. He made no other purchases with the card and paid off his balance after two and a half years of making identical monthly payments. The computer consumed about $0.79 of electricity every day. In total, what percentage of the lifetime cost of the computer did the electricity make up

Answer 1

Based on the cost of the computer in terms of electricity, and the amount he paid for it, the percentage of the cost that the electricity made up is 54.898%.

What percentage of the cost did the electricity use?

First find the amount that Seth paid over the two and half years:

= Monthly payment x 2.5 years x 12 months a year

= 55.32 x 2.5 x 12

= $1,659.60

The cost of the computer over 7 years is:

= (0.79 per day x 365 x 7)

= $2,018.45

The percentage that electricity takes is:

= 2,018.45 / (2,018.45 + 1,659.60)

= 54.88%

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