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Math Help - Cash over installments question .

  1. #1
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    Cash over installments question .

    There is a question in my book which is:
    Mr.Brown can pay for an article in either of the two ways. He can pay the list price with a down payment of 20% and the balance in 5 installments of $16 each or he can pay the cash price of $88.How much does he save by paying the cash price ?
    The book says the answer is $12.00 but according to me its $9.60. Here is how i did it

    20% of 88 is $17.6
    The installments will cost him :16x5=80
    So He has to pay a total of 17.6+80=97.6
    The difference would then be 97.6-88=9.6Ans
    Is my answer correct and that's a typo in the book or am i doing something wrong here ??
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  2. #2
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    Re: Cash over installments question .

    Quote Originally Posted by MikeNoob View Post
    Here is how i did it
    20% of 88 is $17.6
    That should be 20% of 100, leaving 80 (5 * 16 = 80)

    If he chooses to pay cash, the 100 is reduced to 88.

    12 is CORRECT.
    Thanks from MikeNoob
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  3. #3
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    Re: Cash over installments question .

    Could you please clarify that a bit more. Why should it be 20% of 100 and not 20% of 88 (since the actual price of the item is $88)?
    Last edited by MikeNoob; May 24th 2012 at 07:32 PM.
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  4. #4
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    Re: Cash over installments question .

    I am just confused why we should take 20% of 100 and not of 88
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  5. #5
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    Re: Cash over installments question .

    5*16 =80, this represents 80% of the total value since he already paid 20% of it, so 100% of the total is 100,
    therefore we take 20% of 100 not 88.
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  6. #6
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    Re: Cash over installments question .

    Thanks for clearing that up guys!!!
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