You are considering two options in purchasing an automobile: Option A: Purchase the vehicle worth $26,200 and pay for the vehicle over 3 years with equal monthly payments at 3% APR financing. Option B: Purchase the vehicle at a discount price of $24,000 to be paid immediately. The funds, which would be used to purchase the vehicle, are presently earning 6% annual interest compounded monthly. Which of the following statements is incorrect? Oa f you go with Option A, the monthly payment would be $761.93. Ob. Option Bis a better choice if you have enough money to purchase in cash. Oc Option B is a better financing plan, as the net cost of financing is cheaper than Option A. Od. The offective annual yield for your funde is 6.17%.

You are considering two options in purchasing an automobile: Option A: Purchase the vehicle worth $26,200 and pay for the vehicle over 3 years with equal monthly payments at 3% APR financing. Option B: Purchase the vehicle at a discount price of $24,000 to be paid immediately. The funds, which would be used to purchase the vehicle, are presently earning 6% annual interest compounded monthly. Which of the following statements is incorrect? Oa f you go with Option A, the monthly payment would be $761.93. Ob. Option Bis a better choice if you have enough money to purchase in cash. Oc Option B is a better financing plan, as the net cost of financing is cheaper than Option A. Od. The offective annual yield for your funde is 6.17%.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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