Question

Brandy is trying to decide between two cell phones. One is free with the two-year contract but she will have to pay the sales tax of 8% on the original price of $399 and the monthly charge is $10 more then she currently pays. The other is on sale for $199 plus a percent sales tax. The monthly charge is the same as she currently pays. Over the two year contract period which phone will be the lower cost and by how much?

Answer 1

First phone
8% of 399 +10 per month for 2 years
=(8•399)/100+ 10• 24= 31.92+240=271.92
Second phone
$199+ 8% of 199=199+ (8•199)/100 =199+15.92 = 214.92

271.92 > 214.92
Phone 2 is better