Shiver's Annual Fuel Bill for Home Heating Is 900 Dollars

Shiver's annual fuel bill for home heating is 900 dollars per year.He considers three alternative plans for insulating his house.Plan A would reduce his annual fuel bill by 15%, plan B would reduce it by 20%, and plan C would eliminate his need for heating fuel altogether.The plan A insulation job would cost Shivers 900 dollars, plan B would cost him 1,600 dollars, and plan C would cost him 9,900 dollars.If the interest rate is 10% and his house and the insulation job last forever, which plan is the best for Shivers?

A) Plans A and B are equally good.
B) Plan B.
C) Plan C.
D) Plan A.
E) He is best off using none of the plans.

Correct Answer:

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