1800 min. months: $50.00 + ((1800 ? 1200) x $.07) = $92.00

Her total bill for year: (6 x $50.00) + (6 x $92.00) = $852.00

Total cost per minute: $852.00 / 14,400 = $.059/minute

Plan C

600 minute month: 600 x $.09 = $54.00

1800 minute month: 1800 x $.09 = $162.00

Her total bill for year: (6 x $54.00) + 6 x $162.00) = $1,296.00

Total cost per minute: $1,296.00 / 14,400 = $.090/minute

Joe

Joe also used 14,400 minutes of long distance service in last 12 months, an average of 1200 minutes each month. Joe used 1200 minutes each and every month. For Joe costs of plans would be:

Plan A

Each month: ($.04 x 1200) + 5.95 = $53.95

His total bill for year: 12 x $53.95 = $647.40

Total cost per minute: $647.00 / 14,400 = $.045/minute

Plan B

Each month: $50.00

His total bill for year: 12 x $50.00 = $600.00

Total cost per minute: $600.00 / 14,400 = $.042/minute

Plan C

Each month: 1200 x $.09 = $108.00

His total bill for year: 12 x $108.00 = $1,296.00

Total cost per minute: $1,296.00 / 14,400 = $.090/minute

Mike

Mike only used 1,200 minutes of long distance service in last 12 months, an average of 100 minutes per month. Mike used 100 minutes each and every month. For Mike cost of plans would be:

Plan A

Each month: ($.04 x 100) + $5.95 = $9.95

His total bill for year: 12 x $9.95 = $119.40

Total cost per minute: $119.40 / 1200 = $.099/minute

Plan B

Each month: $50.00

His total bill for year: 12 x $50.00 = $600.00

Total cost per minute: $600.00 / 1200 = $.50/minute

Plan C

Each month: 100 x $.09 = $90.00

His total bill for year: 12 x $9.00 = $108.00

Total cost per minute: $108.00 / 1,200 = $.090/minute

So Mary should use Plan A (4.5 cents/minute), Joe should use Plan B (4.2 cents/minute), and Mike should use plan C (9.0 cents/minute). Three different people, looking at same 3 plans, with 3 different results. The lessons: know your usage, and figure your cost per minute.

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