Problem 5-6 A real estate agent is considering changing her cell phone plan. The

Question

Problem 5-6 A real estate agent is considering changing her cell phone plan. There are three plans to choose from, all of which involve a monthly service charge of $20. Plan A has a cost of S.45 a minute for daytime calls and $.20 a minute for evening calls. Plan B has a charge of S.55 a minute for daytime calls and $.15 a minute for evening calls. Plan C has a flat rate of $80 with 200 minutes of calls allowed per month and a charge of S.40 per minute beyond that, day or evening a. Determine the total charge under each plan for this case: 120 minutes of day calls and 40 minutes of evening calls in a month. (Do not round intermediate calculations. Round your answer to 2 decimal places. Omit the "$" sign in your response.) Cost for Plan A Cost for Plan B Cat or Phan C c. If the agent will use the service for daytime calls, over what range of call minutes will each plan be optimal? (Round each answer to the nearest whole number.lnclude the indifference point itself in each answer.) Plan A is optimal from zero to onward minutes. Plan C is optimal from minutes d. Suppose that the agent expects both daytime and evening calls. At what point (i.e., percentage of total call minutes used for daytime calls) would she be indifferent between plans A and B? (Do not round intermediate calculations. Enter your answer as a percentage rounded to 2 decimal places. Omit the "%" sign in your response.) percent daytime minutes

Explanation / Answer

C.

A Plan Fixed charge Variable day($/Min) Variable evening$/Min) A 20 0.45 0.2 B 20 0.55 0.15 C 100 0.4 0.4 (var after 200 mins) For Mins 120 40 Cost of plan A 20 54 8 82 Ans B 20 66 6 92 Ans C 100 100 Ans

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