Question

4. **Suzie makes a purchase of $160 and is charged 7.85% for sales tax. What is the total cost of the purchase if Suzie charges it on a credit

card with a daily interest rate of 0.042% and pays the balance off at the end of 30 days? Round to the nearest cent
Hint: 1st, calculate the total cost of the purchase, which includes the sales tax. It is $160+($160 sales tax). Don't forget to change to
decimal before multiplying.
2nd, what will the interest per day be? You can find this by multiplying 0.042% (change to decimal first) by the total cost of the purchase you
found in 1st step. Now multiply the interest you found by 30 days, and add it to the total cost of the purchase.
a. $172.56
b. $174.73
c. $190.77
d. $200.26

Answer 1

First find the sales tax: $160 \times 0.0785 = $12.56.

Then add the sales tax to the price of the purchase to find the total cost: $160 + $12.56 = $172.56.

Next find the daily interest rate: $0.042\% = 0.00042$.

Then multiply the daily interest rate by the total cost to find the interest per day: $0.00042 \times $172.56 = $0.0725752$.

Finally, multiply the interest per day by 30 days to find the total interest and add it to the total cost to find the final answer: $0.0725752 \times 30 = $2.177256 + $172.56 = $174.737256 \approx $174.74.

So the answer is b.