Suppose that an installment plan calls for five payments to be made. The total paid in this plan is 20% more than the price would be if paid in full immediately. The price of the item is $200. How much will each installment payment be?
A.
$48
B.
$240
C.
$40
D.
$52
Let's start by finding out the price of the item if paid in full immediately. We know that the total paid in the installment plan is 20% more than this price, so the price would be $200 / 1.20 = $<<200/1.20=166.67>>166.67.
Now we need to find out how much each installment payment will be. We divide $166.67 by 5 (the number of payments) to get $166.67 / 5 = $<<166.67/5=33.33>>33.33.
Therefore, each installment payment will be $33.33, rounded to the nearest whole number, which is $<<33.33=33>>33.
The correct answer is not among the available options.
To find the amount of each installment payment, we first need to calculate the total amount paid in the installment plan.
We know that the price of the item is $200. The total paid in the installment plan is 20% more than the price paid in full immediately.
To find the total amount paid in the installment plan, we can calculate 120% of the price ($200) using the formula:
Total amount paid = Price paid in full immediately + (20% of Price paid in full immediately)
Total amount paid = $200 + (0.2 * $200)
Total amount paid = $200 + $40
Total amount paid = $240
Now that we know the total amount paid, we can divide it by the number of payments (five) to find the amount of each installment payment.
Amount of each installment payment = Total amount paid / Number of payments
Amount of each installment payment = $240 / 5
Amount of each installment payment = $48
Therefore, each installment payment will be $48.
So, the correct answer is option A. $48.
To find out how much each installment payment will be, we need to calculate the total paid in the installment plan first.
Let's start by finding out what the total price would be if paid in full immediately. We know that the item costs $200.
Since the total paid in the installment plan is 20% more than the price paid in full immediately, we can calculate it as follows:
Total paid = Price paid in full immediately + 20% of the price paid in full immediately
Total paid = $200 + 20/100 * $200
Total paid = $200 + $40
Total paid = $240
Now that we know the total paid in the installment plan is $240, and there are five payments to be made, we can calculate the amount of each installment payment by dividing the total by the number of payments:
Installment payment = Total paid / Number of payments
Installment payment = $240 / 5
Installment payment = $48
Therefore, each installment payment will be $48.
So, the correct answer is A. $48.