You are trying to decide between two mobile phone carriers. Carrier A requires you to pay $185 for the phone and then monthly charges of $60 for 24 months. Carrier B wants you to pay $115 for the phone and monthly charges of $76 for 12 months. Assume you will keep replacing the phone after your contract expires. Your cost of capital is 4.1% APR, compounded monthly. Based on cost alone, which carrier should you choose? The EAA for plan A is $ (Round to the nearest cent.) The EAA for plan B is $ (Round to the nearest cent.) Based on the cost alone, you will choose |. (Select from the drop-down menu.)

You are trying to decide between two mobile phone carriers. Carrier A requires you to pay $185 for the phone and then monthly charges of $60 for 24 months. Carrier B wants you to pay $115 for the phone and monthly charges of $76 for 12 months. Assume you will keep replacing the phone after your contract expires. Your cost of capital is 4.1% APR, compounded monthly. Based on cost alone, which carrier should you choose? The EAA for plan A is $ (Round to the nearest cent.) The EAA for plan B is $ (Round to the nearest cent.) Based on the cost alone, you will choose |. (Select from the drop-down menu.)

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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