Gibson ES-195 Electric Guitar (with Case), Vintage Transparent Amber Gloss, Blemished This big-bodied fully-hollow guitar is loaded with P-94 pickups and a Bigsby vibrato to take your tone and your playing to bold new places. "My Precious" RETAIL PRICE: TODAY ONLY FINANCING TERMS: DOWN PAYMENT APR TERM (yrs) Financing Option #1: Finance now Monthly Payment Total Paid Back Total Cost Interest Paid $ Months req'd Years req'd 3,998 51% off 5% 8.50% 4 $47.74 $2,291.74 $2,393.69 $354.71 Saving Option: Save until I can afford full retail price Assumed monthly savings: $75 Assumed savings rate: 10% 53.3 4.4 Sale Price: Down Payment: Amount to Finance: monthly interest rate $2,038.98 $101.95 $1,937.03 How many months must I save? How many years does that equal? 0.007083333: What will my monthly payment be to own "My Precious"? Total amount paid to bank? What does "My Precious" really cost me? How much I pay in interest to be able to own "My Precious" today.

PFIN (with PFIN Online, 1 term (6 months) Printed Access Card) (New, Engaging Titles from 4LTR Press)
6th Edition
ISBN:9781337117005
Author:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk
Publisher:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk
Chapter7: Using Consumer Loans
Section: Chapter Questions
Problem 8FPE
icon
Related questions
Question

I have done this question but I'm not sure if it is correct,could you guys take a look at it and let me know if it is correct please?Could you provide me with some explanation on how to solve it?Step by step please 

Cost of Credit Assignment
Name: Pedro Chavez
Gibson ES-195 Electric Guitar (with Case), Vintage Transparent Amber Gloss, Blemished
This big-bodied fully-hollow guitar is loaded with P-94 pickups and a Bigsby vibrato to take your tone and
your playing to bold new places.
"My Precious"
RETAIL PRICE:
TODAY ONLY
FINANCING TERMS:
DOWN PAYMENT
APR
TERM (yrs)
Financing Option #1: Finance now
Monthly Payment
Total Paid Back
Total Cost
Interest Paid
$ 3,998
Months req'd
Years req'd
51% off
5%
8.50%
4
$47.74
$2,291.74
$2,393.69
$354.71
Saving Option: Save until I can afford full retail price
Assumed monthly savings:
$75
Assumed savings rate:
10%
53.3
4.4
Sale Price:
Down Payment:
Amount to Finance:
monthly interest rate
$2,038.98
$101.95
$1,937.03
How many months must I save?
How many years does that equal?
0.0070833333
What will my monthly payment be to own "My Precious"?
Total amount paid to bank?
What does "My Precious" really cost me?
How much I pay in interest to be able to own "My Precious" today.
Transcribed Image Text:Cost of Credit Assignment Name: Pedro Chavez Gibson ES-195 Electric Guitar (with Case), Vintage Transparent Amber Gloss, Blemished This big-bodied fully-hollow guitar is loaded with P-94 pickups and a Bigsby vibrato to take your tone and your playing to bold new places. "My Precious" RETAIL PRICE: TODAY ONLY FINANCING TERMS: DOWN PAYMENT APR TERM (yrs) Financing Option #1: Finance now Monthly Payment Total Paid Back Total Cost Interest Paid $ 3,998 Months req'd Years req'd 51% off 5% 8.50% 4 $47.74 $2,291.74 $2,393.69 $354.71 Saving Option: Save until I can afford full retail price Assumed monthly savings: $75 Assumed savings rate: 10% 53.3 4.4 Sale Price: Down Payment: Amount to Finance: monthly interest rate $2,038.98 $101.95 $1,937.03 How many months must I save? How many years does that equal? 0.0070833333 What will my monthly payment be to own "My Precious"? Total amount paid to bank? What does "My Precious" really cost me? How much I pay in interest to be able to own "My Precious" today.
Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 4 steps with 2 images

Blurred answer
Knowledge Booster
Valuing Decision
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, finance and related others by exploring similar questions and additional content below.
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
PFIN (with PFIN Online, 1 term (6 months) Printed…
PFIN (with PFIN Online, 1 term (6 months) Printed…
Finance
ISBN:
9781337117005
Author:
Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk
Publisher:
Cengage Learning
Pfin (with Mindtap, 1 Term Printed Access Card) (…
Pfin (with Mindtap, 1 Term Printed Access Card) (…
Finance
ISBN:
9780357033609
Author:
Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk
Publisher:
Cengage Learning
Cornerstones of Financial Accounting
Cornerstones of Financial Accounting
Accounting
ISBN:
9781337690881
Author:
Jay Rich, Jeff Jones
Publisher:
Cengage Learning
Quickbooks Online Accounting
Quickbooks Online Accounting
Accounting
ISBN:
9780357391693
Author:
Owen
Publisher:
Cengage