Present value. A smooth-talking used-car salesman who smiles considerably is offering you a great deal on a "pre-owned" car. He says, "For only 6 annual payments of $2,500, this beautiful 1998 Honda Civic can be yours." If you can borrow money at 10%, what is the price of this car? Assume the payment is made at the end of each year. If you can borrow money at 10%, what is the price of this car?

Present value. A smooth-talking used-car salesman who smiles considerably is offering you a great deal on a "pre-owned" car. He says, "For only 6 annual payments of $2,500, this beautiful 1998 Honda Civic can be yours." If you can borrow money at 10%, what is the price of this car? Assume the payment is made at the end of each year. If you can borrow money at 10%, what is the price of this car?

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Similar questions

Suppose a property you are seeking to purchase is valued at $200,000. You can take out a loan of 80 percent from the bank, which amortizes in 30 years. The current market interest rate is 7.35 percent. Suppose you can only afford a monthly payment of USD 900, but the seller is desperate to sell this property. The seller has already lowered the selling price to USD 180,000. What is the minimum amount of rebate that the seller should provide to you in order to make you purchase the property?
After years of working hard and finally becoming a millionaire, you would like to reward yourself by buying a sports car. Dealer A offers a model that you like for just RM1.8 million, if purchased and fully paid now. Dealer B offers the same model for RM2 million, but you can pay for the car after 2 years of ownership. Determine which offer is economically better, considering interest rate of 5% per year. Explain your answer.
Congratulations! You just bought a new car. You didn't have enough cash to pay for the whole thing right now, so you decided to finance the purchase and get a car loan. You will be making payments of $436.08 at the end of every month for 4 years. The rate of interest is 5 6% compounded annually. Determine the original purchase price of the car
Suppose that Cougar Autos offers an "easy payment" scheme on a new Honda of $4,000 a year, paid at the end of each of the next four years, with no cash down. What is the car really costing you? The interest rate is 6% Show EXCEL formula.
Present value. A smooth-talking used-car salesman who smiles considerably is offering you a great deal on a "pre-owned" car. He says, "For only 6 annual payments of $2,600, this beautiful 1998 Honda Civic can be yours." If you can borrow money at 10%, what is the price of this car? Assume the payment is made at the end of each year. If you can borrow money at 10%, what is the price of this car? $nothing (Round to the nearest cent.)
After graduation, you just got hired by an engineering company and you were planning to take aloan in order to purchase a new car. Let’s assume that the bank is willing to offer you a personalloan with an annual interest rate of 6% compounded yearly. The car price is 26,500 JD and youare capable to pay 4,200 JD per year. After how many years you will be able to pay back the loanwith the accumulated interest (use a spreadsheet to answer this question) and draw the cash flowdiagram.
Present value. A smooth-talking used-car salesman who smiles considerably is offering you a great deal on a "pre-owned" car. He says, "For only 8 annual payments of $2,600, this beautiful 1998 Honda Civic can be yours." If you can borrow money at 9%, what is the price of this car? Assume the payment is made at the end of each year. If you can borrow money at 9%, what is the price of this car?
what would the formula be to solve for the table value? the table value is what i need to solve the problem
1. You borrow 7,000 dollars to help pay your college expenses. You agree to repay the loan at the end of 4 years at 8% interest compounded quarterly. What is the maturity value of the loan? 2. If inflation causes the cost of automobiles to increase by 2.5% each year. What should a car cost today if it cost 21,000 dollars 5 years ago? 3. Assume you are thinking of buying a house currently priced at 169,000 dollars. If housing prices rise at an annual inflation rate of 3% , estimate the purchase price of a similar house if you wait 4 years before committing yourself to buying one. 4. Suppose when you are 52 years old, the yearly statement you get from the Social Security Administration estimates that your monthly payment at age 66 will be 620 dollars. If inflation stays constant at 2% , what will be the purchasing power of that 620 dollars.
The local electronics store is offering a promotion "1-year: same as cash," meaning that you can buy a TV now, and wait a year to pay (with no interest). So, if you take home a $1,200 TV today, you will owe them $1,200 in one year. If your bank is offering 4% interest, what is the true cost of the TV to you today? The true cost of the TV to you today is $ (Round to the nearest cent.)

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