You have saved $4,000 for a down payment on a new car. The largest monthly payment you can afford is $300. The loan will have a 15% APR based on end-of-month payments. What is the most expensive car you can afford if you finance it for 48 months? For 60 months? Do not round intermediate calculations. Round your answers to the nearest cent. Financed for 48 months: $ Financed for 60 months:
You have saved $4,000 for a down payment on a new car. The largest monthly payment you can afford is $300. The loan will have a 15% APR based on end-of-month payments. What is the most expensive car you can afford if you finance it for 48 months? For 60 months? Do not round intermediate calculations. Round your answers to the nearest cent. Financed for 48 months: $ Financed for 60 months:
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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You have saved $4,000 for a down payment on a new car. The largest monthly payment you can afford is $300. The loan will have a 15% APR based on end-of-month payments. What is the most expensive car you can afford if you finance it for 48 months? For 60 months? Do not round intermediate calculations. Round your answers to the nearest cent.
Financed for 48 months: $
Financed for 60 months: $
Expert Solution
Step 1
Present Value can be calculated using PV function in excel
PV (rate, nper, pmt, [Fv], [type])
- Rate The interest rate
- Nper The total number of payments
- Pmt Payment per period
- Pv The present value
- Fv The future value
- Type The number 0 (zero) or 1 and indicates when payments are due.
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