Question

One of the major costs associated with setting up a new bakery is the cost of the oven. Monica and Lauren have researched many types of ovens, and they have narrowed their search down to two brands. Both of these brands charge an initial set–up fee, plus a monthly rental fee. The total fees of each brand can be found in the table below.


Brand 12–month Rental ($) 24–month Rental ($)

A (12-month-798.95) (24-month-1521.95)

B (12-month-794.10) (24-month-1511.10)


The girls want to spend the least amount of money upfront for the initial set–up fee. Using that criteria, determine which brand the girls should choose, and then answer the following question.


What is the monthly rental fee the girls will pay using the brand you chose?

Answer 1

The brand the girls should choose is brand A. The monthly rental fee the girls would pay is $63.41.

Which options offer the lowest upfront fee?

In order to determine the upfront fee for both options, divide the 12 month fee for each option by 12 and the 24 month fee by 24.

Option A: 12 month fee = 798.95 / 12 = 66.58

24 month fee = 1521.95 / 24 = 63.41

Upfront fee = 66.58 - 63.41 = 3.17

Option B: 12 month fee = 794.10 / 12 = 66.18

24 month fee = 1511.10 / 24 = 62.96

Upfront fee = 66.18 - 62.96 = 3.22

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