Your parents are renting an apartment for you when you go away to college. An annual contract is $502.00/month with a 2-month penalty if you break the lease. The month-to-month contract is $615.00/month. Say you leave after 6 months. How much is the difference in the amount paid between the two contracts?
Answers
Answer:
The difference in the amount paid between the two contracts is $326.
Step-by-step explanation:
Given : An annual contract is $502.00/month with a 2-month penalty if you break the lease. The month-to-month contract is $615.00/month. Say you leave after 6 months.
To find : How much is the difference in the amount paid between the two contracts?
Solution :
Annual contract: The annual contract means a contract for 12 months. There is a month penalty for breaking the lease.
In our case the penalty is 2 month means if you left after 6 months, you will have to pay for 8 month.
Total paid = Monthly payment × 8
Total paid = 502 × 8 = $4016
Month-to-month contract: The payment is for actual month stayed.
You will only paid for the 6 months you stayed,
Total paid = Monthly payment × 6
Total paid = 615 × 6= $3690
To get the difference in the amount paid between the two contracts is
Difference = Annual contract - Month-month contract
Difference = 4016 - 3690 = $326
Therefore,The difference in the amount paid between the two contracts is $326.
3690 for month to month contract
Difference 326 less from the month to month
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