Question

You are considering buying one of two brands of barbecue grills. Brand F costs $650 and will last for about fifteen years. Brand G costs $200 and will last for about five years, so you will need to buy three of them over the years to equal one Brand F grill. In either case, you plan to pay for the grill with your credit card, which has an interest rate of 13.01%, compounded monthly. You will pay off a Brand F grill in five years of monthly payments, and you will pay off a Brand G grill in three years of monthly payments. Assuming that you have no other purchases on your credit card, over a fifteen-year period, which kind of grill will be cheaper, and how much cheaper will it be? (Round all dollar values to the nearest cent.)
a.
Brand G will end up costing $159.48 less than Brand F.
b.
Brand G will end up costing $50.00 less than Brand F.
c.
Brand F will end up costing $134.28 less than Brand G.
d.
Brand F will end up costing $91.08 less than Brand G.


Please select the best answer from the choices provided

A
B
C
D

Answer 1

A

Brand G will end up costing $159.48 less than Brand F.