A toaster oven costing $130 offers an extended warranty for 25% of the purchase price. If the local repair shop will fix a toaster oven for $8, how many times must the toaster oven break in order for the warranty to pay for itself?

Question

a.
five
b.
six
c.
four
d.
one

Answer 1

To determine how many times the toaster oven must break for the warranty to pay for itself, we first need to calculate the cost of the extended warranty and compare it to the repair cost.

1. Calculate the cost of the warranty:
   The warranty costs 25% of the purchase price of the toaster oven. \[ \text{Cost of Warranty} = 25% \times \text{Cost of Toaster Oven} = 0.25 \times 130 = 32.5 \]

2. Calculate the repair cost:
   The repair shop charges $8 per repair.

3. Calculate the number of repairs needed for the warranty to pay for itself:
   We need to find out how many repairs (let's call it \( x \)) it would take for the total repair costs to equal the cost of the warranty. \[ 8x = 32.5 \] Now, solving for \( x \): \[ x = \frac{32.5}{8} = 4.0625 \]

Since the number of times the toaster oven needs to break must be a whole number, we round up to the nearest whole number:

• It would take 5 breaks for the warranty to pay for itself.

Thus, the answer is: a. five.