Question

A local RadioShack store wants to buy a new line of plasma TVs. Manufacturer A offers chain discounts of 18/12, and Manufacturer B offers terms of 17/13. Which single equivalent discount rate is the best deal?

Answer 1

Given that a local RadioShack store wants to buy a new line of plasma TVs. Manufacturer A offers chain discounts of 18/12, and Manufacturer B offers terms of 17/13.

Let the list price of the plasma TVs be x, then after a chain discount of 18/12 by Manufacturer A, the selling price of the plasma TVs will be (1 - 0.18)(1 - 0.12)x = 0.82(0.88)x = 0.7216x

Also, after the discount of 17/13 by manufacturer B, the selling price of the plasma TVs will be (1 - 0.17)(1 - 0.13)x = 0.83(0.87)x = 0.7221x

Thus, the final selling price after discount by manufacturer A is 0.7216 and the final selling price after dscount by manufacturer B is 0.7221x.

Therefore, Manufacturer A offers a single equivalent discount rate that is the best deal.