What was the equation for the total cost of the with-phone contract?
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2)
Shay chose to plot points for x = 10 and x = 20 because those values were round numbers and so a bit easier to calculate and draw. For the no-phone contract, what did Shay determine as the y value when x was 10?
$
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3)
The graph of both contracts shows the with-phone contract to be how much cheaper at the start, when months is 0?
$
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4)
The breakeven point, where the no-phone contract’s total cost becomes cheaper, is at how many months?
5)
The graphs not only show the breakeven point (15 months), but give a person a quick way to see the cost difference for any number of months. At 24 months, a person might visually see the blue line at about 1200 and the purple line at about 1000. What is the overall savings for the no-phone contract after 24 months?
A home loan monthly payment is often a person’s largest expense, perhaps consuming 30% or more of monthly earnings. A home loan has an interest rate, like 6%, that lasts for the loan’s duration, which might be 30 years. If rates go down, a newer loan might have a lower interest rate, like 4.5%. Replacing a home loan with a new lower-interest loan is called refinancing. Refinancing may cost thousands of dollars, so a task is determining whether refinancing is worth that cost.Initially (months = 0), what is the cost difference between the current loan versus refinancing? Answer by looking where each line touches the y axis.
0
3000
2)
At 2 months, what is the difference in cost of the current loan versus refinancing? Answer by looking at each line’s height when x is 2.
2000
4000
3)
At 6 months, the two options cost the same (the breakeven point). What is that cost?
0
12000
4)
Which option will be cheaper after 1 year?
Current loan
Refinanced loan
5)
The graphs below show the difference between the current loan and the refinanced loan over 10 years (120 months). What is the savings from the refinance after 10 years?
