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Question 882970: Kim Davis has decided to purchase a cellular phone, but she is ensure about which rate plan to select. The regular plan charges a fixed fee of $55 per month for 1,000 minutes of airtime plus $0.33 per minute for any time over 1,000 minutes. The executive plan charges a fixed fee of $100 per month for 1,200 minutes airtime plus $0.25 per minute over 1,200 minutes. If Kim expects to use the phone for 21 hours per month, which plan should she select? At what level of use would Kim be indifferent between the two plans?
Answer by benparker321(2)   (Show Source):
You can put this solution on YOUR website! Regular plan = $55 Per MONTH for 1,000 min Airtime + $0.33 PER MIN for anytime OVER 1,000 min.
Executive plan = $100 PER MONTH for 1,200 min Airtime + $0.25 PER MIN OVER 1,200 min.
Expected time Kim will use is 21 hours PER MONTH.
1000 min = 17 hours REGULAR PLAN ( It was 16.667 round it to 17 )
1200 min = 20 hours EXECUTIVE PLAN ( exactly 20 hours )
21 hours - 17 hours = 4 hours(240 min) × $0.33(PER MIN)= 79.20 extra Dollars
( REGULAR PLAN )
21 hours - 20 hours = 1 hour(60 min) × $0.25(PER MIN) = 15 extra Dollars
( EXECUTIVE PLAN )
$55(Fixed Fee) + $79.20($0.33 × 4 hours(240 min) = $134.20 grand total for
( REGULAR PLAN )
$100(Fixed fee) + $15($0.25 * 1 hour(60 min) = $115 grand total for
( EXECUTIVE PLAN )
$134.20( REGULAR PLAN ) > $115( EXECUTIVE PLAN )
The better plan for Kim would be the Executive plan
hope this helped
good luck
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