No matter which brand he chooses, Gareth will pay for the freezer on his credit card, which has an APR of 9.31%, compounded monthly. It takes Gareth eighteen months to pay off a Brand S freezer and four years to pay off a Brand R freezer. Assuming that Gareth makes no other purchases or payments with his credit card, over the next ten years, which brand of freezer will have a lower lifetime cost, and how much lower will it be? (Round all dollar values to the nearest cent.)

Question

Cassie Jefferson

Business

31 July, 02:12

No matter which brand he chooses, Gareth will pay for the freezer on his credit card, which has an APR of 9.31%, compounded monthly. It takes Gareth eighteen months to pay off a Brand S freezer and four years to pay off a Brand R freezer. Assuming that Gareth makes no other purchases or payments with his credit card, over the next ten years, which brand of freezer will have a lower lifetime cost, and how much lower will it be? (Round all dollar values to the nearest cent.)

+4

Answers (2)

Know the Answer?

Danika Mccormick · Answer 1

The Brand S freezer will have a lower lifetime cost because he will pay less interest on it in the long run. However, we don't know how much each brand of freezer costs, so we can't say exactly how much lower his cost will be.