A telecom company offers two post‑paid mobile plans.

Plan A: a fixed monthly fee of $\text{₦}5,000$ plus a call charge of $\text{₦}25$ per minute for the first 200 minutes and $\text{₦}15$ per minute for any additional minutes.

Plan B: no fixed monthly fee, a call charge of $\text{₦}30$ per minute for the first 300 minutes and $\text{₦}10$ per minute thereafter, and a one‑time activation fee of $\text{₦}2,000$ (paid in the first month only).

If a customer expects to use 350 minutes each month for 12 months, which plan will cost less over the 12‑month period, and by how much (in Naira)?

Question

A telecom company offers two post‑paid mobile plans.

Plan A: a fixed monthly fee of $\text{₦}5,000$ plus a call charge of $\text{₦}25$ per minute for the first 200 minutes and $\text{₦}15$ per minute for any additional minutes.

Plan B: no fixed monthly fee, a call charge of $\text{₦}30$ per minute for the first 300 minutes and $\text{₦}10$ per minute thereafter, and a one‑time activation fee of $\text{₦}2,000$ (paid in the first month only).

If a customer expects to use 350 minutes each month for 12 months, which plan will cost less over the 12‑month period, and by how much (in Naira)?

Accepted Answer

Plan B; cheaper by 	ext{₦}31,000

Neco Model Questions Vol1 2020 Commerce Question 29

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