You have saved $5,000 for a down payment on a new car. The largest monthly payment you can afford is $500. The loan will have a 6% 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: $

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A: The term "annuity" refers to a contract created and offered by financial institutions with the goal…

Q: You want to buy a car, and a local bank will lend you $25,000. The loan will be fully amortized over…

A: Monthly Loan Payment = PV*(r*(1+r)n)((1+r)n-1)  where: PV is the present value of the loan r is the…

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A: Maximum value is the present value of cash flow from the annuity based on the time value of money…

Q: You have saved $4,000 for a down payment on a new car. The largest monthly payment you can afford is…

A: Present Value can be calculated using PV function in excel   PV (rate, nper, pmt, [Fv], [type])…

Q: You are saving to buy a new car in two years.  You currently have $5000 in an account that pays 4%…

A: We need to use present value formula below to calculate amount required today in account.PV…

Q: secures financing for the balance at the rate of 9%/year compounded monthly. (Round your answers to…

A: Answer : price of new car =$16000 Less : Down payment = $16000*25% = $4000 Amount financed = $16000…

Q: suppose that you decide to borrow $15,000 for a new car. you can select one of the following loans,…

A: a.Loan ALoan Amount (pv) = $15,000Interest Rate (rate) = 5.9%Time Period = 3 YearsNumber of Payments…

Q: You plan to fina

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A: In the given problem we are considering to buy a new car and we want to know how much money we can…

Q: Suppose you decide to take the tour now and use a 15% credit card for the purchase. A. How many…

A: Hello. Since your question has multiple sub-parts, we will solve first the three sub-parts for you.…

Q: Solve the following problems. Round your results to the nearest cent as needed. You need a loan to…

A: P = $24,200 (loan amount),(monthly interest rate),n=6×12 (number of months in 6 years).

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A: Loan is a financial contract engaging a lender who provides money or assets to a borrower who agrees…

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A: Financed for 48 months: $17,267.77Financed for 60 months: $19,621.38

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A:

Q: You want to buy a car, and a local bank will lend you $25,000. The loan will be fully amortized over…

A: Compound = n = Monthly = 12Present Value = pv = $25,000Time = t = 5 * 12 = 60Interest Rate = r = 9 /…

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A: Upfront purchase price = $ 100,000 - 21% discount = 79,000Hence, PV = - 79,000Otherwise under…

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A: Using excel PV function to get the loan amount

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A: Loan is a financial obligation that is repayable in the future. A loan is repayable according to the…

Q: payments. What is the most expensive car you can afford if you finance it for 48 months? For 60 me…

A: The monthly payment consist of payment of principal and interest to be paid over the life of…

Q: You have saved $3,000 for a down payment on a new car. The largest monthly payment you can afford is…

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Q: ave selected a new car to purchase for $19,500. If the car can be financed over a period of 4 years…

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Cost of Credit

The cost of credit is an extra amount that the borrower has to pay besides the loan amount. These credit charges may vary from loan to loan. The cost of credit includes interest charges, maintenance charges, and arrangement charges. Some of the costs are mandatorily collected by the lender based on the loan amount and tenure of the loan. The cost of credit is also called finance charges of the credit.