The chart shows pricing and payment options for two large items.

\begin{tabular}{|c|c|c|c|}
\hline
Item & \begin{tabular}{c} Rent-to-own \\ payments \end{tabular} & \begin{tabular}{c} Installment \\ plan \end{tabular} & \begin{tabular}{l} Cash \\ price \end{tabular} \\
\hline
\begin{tabular}{c} Laptop \\ computer \end{tabular} & \begin{tabular}{c} \[tex]$150 a \\ month for \\ 12 months \end{tabular} & \begin{tabular}{c} \$[/tex]100.83 a \\ month for \\ 12 months \end{tabular} & \[tex]$1,000 \\
\hline
\begin{tabular}{l} 18.3 CF \\ refrigerator \end{tabular} & \begin{tabular}{l} \$[/tex]140 a \\ month for \\ 12 months \end{tabular} & \begin{tabular}{c} \[tex]$80.67 a \\ month for \\ 12 months \end{tabular} & \$[/tex]800 \\
\hline
\end{tabular}

Why would a consumer choose to pay cash?

A. to pay the lowest possible price
B. to take advantage of low interest
C. to spread payments out over time
D. to avoid saving for a down payment



Answer :

To determine which payment option results in the lowest possible price, let's analyze the total costs for each payment method for both the laptop and the refrigerator.

### Laptop Computer

1. Rent-to-Own Payments:
- Monthly payment: [tex]$150 - Duration: 12 months - Total cost: \( 150 \, \text{dollars/month} \times 12 \, \text{months} = 1800 \, \text{dollars} \) 2. Installment Plan: - Monthly payment: $[/tex]100.83
- Duration: 12 months
- Total cost: [tex]\( 100.83 \, \text{dollars/month} \times 12 \, \text{months} = 1209.96 \, \text{dollars} \)[/tex]

3. Cash Price:
- Immediate payment: [tex]$1000 ### 18.3 CF Refrigerator 1. Rent-to-Own Payments: - Monthly payment: $[/tex]140
- Duration: 12 months
- Total cost: [tex]\( 140 \, \text{dollars/month} \times 12 \, \text{months} = 1680 \, \text{dollars} \)[/tex]

2. Installment Plan:
- Monthly payment: [tex]$80.67 - Duration: 12 months - Total cost: \( 80.67 \, \text{dollars/month} \times 12 \, \text{months} = 968.04 \, \text{dollars} \) 3. Cash Price: - Immediate payment: $[/tex]800

### Summary of Costs

- Laptop Computer:
- Rent-to-Own: [tex]$1800 - Installment: $[/tex]1209.96
- Cash: [tex]$1000 - Refrigerator: - Rent-to-Own: $[/tex]1680
- Installment: [tex]$968.04 - Cash: $[/tex]800

### Conclusion

The consumer should choose to pay cash if their goal is to pay the lowest possible price. This is because:

- For the laptop, the cash price of [tex]$1000 is significantly lower than the rent-to-own and installment plans. - For the refrigerator, the cash price of $[/tex]800 is also the lowest compared to other payment methods.

Thus, a consumer would choose to pay cash to pay the lowest possible price.