A Furniture Store Is Offering Free Credit on Purchases Over

question 54

Multiple Choice

A furniture store is offering free credit on purchases over $1,000.You observe that a big-screen television can be purchased for nothing down and $4,000 due in one year.The store next door offers an identical television for $3,650 but does not offer credit terms.Which statement below best describes the cost of the "free" credit?

• A) 8.75%
• B) 9.13%
• C) 9.59%
• D) 0%