Question

comparing the cost of ownership

consumers would pay:
used the rent-to-own pr
the computer.
for all of the items, usi
is the cheapest option
the most expensive ov
a rent-to-own program to purchase the item.

item

rent-to-own payments

installment plan

cash price

----

----

----

----

laptop computer

$150 a month for 12 months

$100.83 a month for 12 months

$1,000

18.3 cf refrigerator

$140 a month for 12 months

$80.67 a month for 12 months

$800

Explanation:

Step1: Calculate laptop rent-to-own total

$\$150 \times 12 = \$1,800$

Step2: Calculate laptop installment total

$\$100.83 \times 12 = \$1,209.96$

Step3: Calculate fridge rent-to-own total

$\$140 \times 12 = \$1,680$

Step4: Calculate fridge installment total

$\$80.67 \times 12 = \$968.04$

Step5: Compare all costs for each item

Laptop: $\$1,000 < \$1,209.96 < \$1,800$
Fridge: $\$800 < \$968.04 < \$1,680$

Answer:

1. Consumers would pay $\$1,800$ if they used the rent-to-own program for the laptop computer.
2. For all of the items, using the cash price is the cheapest option.
3. The most expensive overall option is using a rent-to-own program to purchase the item.
4. The difference between the most expensive and cheapest laptop options is $\$1,800 - \$1,000 = \$800.00$
5. The difference between the most expensive and cheapest fridge options is $\$1,680 - \$800 = \$880.00$