Three purchase plans are available for a new car. -Plan A: $5,000 Cash immediately -Plan B: $1,500 down and 36 monthly payments of $116.25 -Plan C: $1,000 down and 48 monthly payments of $120.50 If a customer expects to keep the car five years and her interest rate is 18% compounded monthly, which payment plan should she choose? Plan A Plan B Plan C

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
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Three purchase plans are available for a new car.
-Plan A: $5,000 Cash immediately
-Plan B: $1,500 down and 36 monthly payments of $116.25
-Plan C: $1,000 down and 48 monthly payments of $120.50
If a customer expects to keep the car five years and her interest rate is 18% compounded monthly, which payment
plan should she choose?
O Plan A
Plan B
Plan C
Transcribed Image Text:Three purchase plans are available for a new car. -Plan A: $5,000 Cash immediately -Plan B: $1,500 down and 36 monthly payments of $116.25 -Plan C: $1,000 down and 48 monthly payments of $120.50 If a customer expects to keep the car five years and her interest rate is 18% compounded monthly, which payment plan should she choose? O Plan A Plan B Plan C
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