This question is incomplete because it lacks the options
Complete question:
Mo has a credit card that gives a 3% discount on every purchase. The annual percentage rate on the card is 12%. He is purchasing an electronic reader for $140. Check all that apply.
1.If Mo uses the credit card and pays the full balance during the billing cycle, the cost of the purchase will be $140.
2.If Mo pays cash, the cost of the purchase will be $140.
3.If Mo uses the credit card and pays off the balance at $30 a month for 7 months with no late fees, the cost of the purchase will be $143.34.
4.If Mo pays cash, the cost of the purchase will be $135.80.
5.If Mo uses the credit card and pays off the balance at $20 a month for 7 months with no late fees, the cost of the purchase will be $139.89.
6.If Mo uses the credit card and pays the full balance during the billing cycle, the cost of the purchase will be $135.88.
Answer:
2) If Mo pays cash, the cost of the purchase will be $140.
5) If Mo uses the credit card and pays off the balance at $20 a month for 7 months with no late fees, the cost of the purchase will be $139.89.
6) If Mo uses the credit card and pays the full balance during the billing cycle, the cost of the purchase will be $135.88.
Explanation:
For the above question, the options 2), 5) and 6) are the correct options that apply. This is explained below in the following reasons.
a) The cost of the electronic reader is $140. Mo has a credit card and he can decide to use his credit card or not to use it. If Mo decides to pay cash for the electronic reader, the amount he would pay as the cost of the purchase would be $140 in cash.
This makes option 2 correct.
b) If Mo decided to use his credit card to pay for the electronic reader, he has a discount of 3% on every purchase.
Therefore,
The purchase costs $140, 3% of $140 =
3% ÷ $140 = 3/100 ÷ $140
= $4.2
So Mo is paying $4.2 less than the original amount of the purchase.
Hence, $140 - $4.2
= $135.8
This makes option 6 correct.
c) If Mo uses the credit card and pays off the balance at $20 a month for 7 months with no late fees, the cost of the purchase will be $139.89.
This makes option 5 correct.
