Respuesta :
The most expensive car could afford, if the finance it for 48 months and 60 moths is of $20,088.28 and $23,229.77. Part of the principal balance and interest are paid with each payment that the borrower makes.
Loan = Payment × [tex]\frac{(1-(1+0.01)^-^4^8}{y}[/tex]
Down payment = 3000
Monthly Payment = 450
Adjust r for monthly compounding (r) = [tex]\frac{0.12}{12}[/tex]
The most expensive car could afford, if the finance it for 48 months
Loan = 450 × [tex]\frac{(1-(1+0.01)^-^4^8}{y}[/tex]
Loan = 17,088.28
Car price = Down payment + Loan
Car price = 3000 + 17,088.28
Car price = 20,088.28
The most expensive car could afford, if the finance it for 60 months
Loan = 450 × [tex]\frac{(1-(1+0.01)^-^6^0}{y}[/tex]
Loan = 20,229.77
Car price = Down payment + Loan
Car price = 3000 + 20,229.77
Car price = 23,229.77
- One of the financial tools that investors employ is a loan. At an agreed-upon interest rate, the borrowed money is repaid in installments. Part of the principal balance and interest are paid with each payment that the borrower makes.
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