January 28th, 2007, 01:45 PM  #1 
Senior Member Joined: Dec 2006 From: New Jersey Posts: 378 Thanks: 1  Cost of Car
The suggested list price of a new car is $1200. The dealer's cost is 85% of the list. How much will you pay if the dealer is willing to accept $100 over the cost for the car? (1) How do I set up an equation to solve this question? (2) In the question itself we read: "The dealer's cost is 85% of the list." Does this mean we are no longer dealing with 85% but actually 15%? (3) What does the wording "$100 over the cost for the car" mean? 
January 28th, 2007, 07:46 PM  #2 
Global Moderator Joined: Nov 2006 From: UTC 5 Posts: 16,046 Thanks: 937 Math Focus: Number theory, computational mathematics, combinatorics, FOM, symbolic logic, TCS, algorithms  Re: Cost of Car
The dealer's cost is 0.85 * $1200. The wording means that the dealer is willing to accept no less than ($100 more than his cost).

January 29th, 2007, 01:22 PM  #3 
Senior Member Joined: Dec 2006 From: New Jersey Posts: 378 Thanks: 1  ok
Are you saying that the answer can be found by 0.85 * $1200?

January 29th, 2007, 01:51 PM  #4 
Senior Member Joined: Nov 2006 From: I'm a figment of my own imagination :? Posts: 848 Thanks: 0 
Not quite. It is 1200*.85 + 100. It's good that you are asking questions when you don't understand something. You will learn a lot more that way.

January 30th, 2007, 02:50 AM  #5 
Senior Member Joined: Dec 2006 From: New Jersey Posts: 378 Thanks: 1  ok
I totally got it but one thing is not clear: why must we add 100 to 1200*.85? Where did 100 come from? 
January 30th, 2007, 02:58 AM  #6  
Senior Member Joined: Dec 2006 Posts: 1,111 Thanks: 0  Quote:
(1200*0.85) +100= price you'll pay for the car  
January 30th, 2007, 01:11 PM  #7 
Senior Member Joined: Dec 2006 From: New Jersey Posts: 378 Thanks: 1  ok
Thanks for letting know. I did not understand when the problem stated: "The dealer won't accept a price below 100$ over his own cost, which is 85% of the list price." 
January 30th, 2007, 04:24 PM  #8 
Global Moderator Joined: Dec 2006 Posts: 18,954 Thanks: 1601 
A "model" dealer buys the car at trade price and then sells it at the list price. The list price suggested by the manufacturer is $1200 and the trade price (the dealer's cost) is 85% of the list price, i.e., $1020, so the dealer's profit is $180. Where the question states "$100 over the cost for the car", "the cost" refers to the trade price of $1020 (i.e., the dealer's cost rather than the cost to you), so the question is stating that the dealer is willing to accept a profit of only $100 by selling the car for $1120. 
February 2nd, 2007, 03:55 PM  #9 
Senior Member Joined: Dec 2006 From: New Jersey Posts: 378 Thanks: 1  ok
Good replies.


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