The list price of a car is $8760. It is available at either a 10 / 20 / 5 or a 35 / 30 trade discount series. Which trade discount series gives the better deal? By how much?

Question

Quizplus · Accepted Answer

To determine which trade discount series gives the better deal, we need to calculate the net price of the car after applying each discount series.

For the 10 / 20 / 5 trade discount series, the net price would be: 
List price * (1- 0.10) * (1- 0.20) * (1- 0.05) = $8760 * 0.72 * 0.8 * 0.95 = $4424.32

For the 35 / 30 trade discount series, the net price would be: 
List price * (1- 0.35) * (1- 0.30) = $8760 * 0.65 * 0.7 = $3780.60

Therefore, the better deal is the 35 / 30 trade discount series because the net price is lower at $3780.60. The difference in the net price between the two options is: 
$4424.32 - $3780.60 = $643.72

However, none of the answer choices match the correct calculation, which should be D) 35 / 30, $643.72.

The List Price of a Car Is $8760