MHB Calculating Annual Saving: Word Problem

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The discussion centers on a math problem regarding calculating annual savings between two mobile network plans, the Gem and Royale plans. A user expresses confusion over the problem, particularly regarding the inclusion of both annual and monthly fees. The calculations reveal that the total annual cost for the Gem plan is £384.99, while the Royale plan totals £443.49, indicating a savings of £58.50 when choosing the Gem plan. However, this calculated savings does not match any provided answer options, leading to further confusion. The conversation highlights the need for clarity in the problem's wording and fee structure.
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Hi, guys, I could not figure out the answer to this Q, no matter how hard I did this math. I know this should not be a difficult one, but really my answer never matched the correct one. Please do help me on how to get the answer? Many thanks!

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emmayu said:
Hi, guys, I could not figure out the answer to this Q, no matter how hard I did this math. I know this should not be a difficult one, but really my answer never matched the correct one. Please do help me on how to get the answer? Many thanks!
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Hi emmayu, :)

Welcome to MHB! I feel that there is a mistake or something missing in this question. What confuses me most is why the problem mentions an annual fee as well as a monthly fee for each of the network plans. :confused:

Annual fee for Gem plan is, 54.99. Note that the customer uses an excess of 50 mins each month for mobile (same network) and mobile (other network) calls. That is if he uses Gem plan he has to pay 50*0.25 + 50*0.30 each month for the excess minutes he used. That constitutes to a 12*(50*0.25 + 50*0.30) annual fee. So the total fee for using the Gem plan is 54.99 + 12*(50*0.25 + 50*0.30) = 384.99 annually.

Since this customer uses the Gem plan we can conclude that he uses 200 mins(same network) and 200 mins(other networks) monthly. Therefore for the Royale plan we get, 59.49 + 12*100*0.32=443.49 annual fee.

So the saving for using the Gem plan is, 443.49-384.99=58.5 which isn't among the answers.

All the above currency amounts are given in pounds.
 
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