You Are Considering the Purchase of a Motorized Scooter Where

question 13

Multiple Choice

You are considering the purchase of a motorized scooter where the price of the scooter is based upon the miles per gallon (mpg) of gasoline that the scooter can achieve.That is,the current price of the scooter that you want is $1,000 because the scooter can achieve 100 miles per gallon and the cost per mpg is $10.Right before you are about to purchase the scooter,your best friend requests that you loan him $1,000 for one year.You make the loan in order to be able to buy a 105 mpg scooter at the conclusion of the loan.If you anticipate that the cost per mpg will increase to $11,what rate of interest do you charge your friend?

• A) 5%
• B) 10%
• C) 15%
• D) 15.5%

---

Definitions:

Months

Units of time, typically consisting of 28 to 31 days, used in calendars to divide the year into twelve periods.

Depth Perception

The ability to perceive the world in three dimensions and to judge the distance of objects.

Infants

Very young children, typically under one year old, who are in the earliest stages of physical and cognitive development.

Months of Age

A method of expressing the age of infants and very young children by the number of months since birth.