Question

You have saved $3,000 for a down payment on a new car. The largest monthly payment you can afford is $300. The loan will have a 10% APR based on end-of-month payments.

A.What is the most expensive car you can afford if you finance it for 48 months? Do not round intermediate calculations. Round your answer to the nearest cent.

B. What is the most expensive car you can afford if you finance it for 60 months? Do not round intermediate calculations. Round your answer to the nearest cent.

Answer #1

P = | Regular Payments | |

PV = | Loan Amount | |

r = | rate of interest | |

n = | no of periods | |

A) | P = | r (PV) |

1 - (1 +
r )^{-n} |
||

300 = | (10%/12)*X | |

1 - (1 / (1 + 10%/12)^48)) | ||

300 = | 0.00833333333333333 X | |

0.328568001 | ||

X = | 300 * 0.328568001 / 0.0083333333333333 | |

X = | 11828.45 | |

LOAN AMOUNT = | $ 11828.45 | |

CAR VALUE = | DOWNPAYMENT+ LOAN AMOUNT | |

3000 + 11828.45 | ||

14828.45 | ||

B) | P = | r (PV) |

1 - (1 +
r )^{-n} |
||

300 = | (10%/12)*X | |

1 - (1 / (1 + 10%/12)^60)) | ||

300 = | 0.00833333333333333 X | |

0.392211409 | ||

X = | 300 * 0.392211409 / 0.0083333333333333 | |

X = | 14119.61 | |

LOAN AMOUNT = | $ 14119.61 | |

CAR VALUE = | DOWNPAYMENT+ LOAN AMOUNT | |

3000 + 14119.61 | ||

$ 17119.61 |

You have saved $3,000 for a down payment on a new car. The
largest monthly payment you can afford is $350. The loan will have
an 8% APR based on end-of-month payments.
What is the most expensive car you can afford if you finance it
for 48 months? Do not round intermediate calculations. Round your
answer to the nearest cent.
What is the most expensive car you can afford if you finance it
for 60 months? Do not round intermediate...

You have saved $3,000 for a down payment on a new car. The
largest monthly payment you can afford is $300. The loan will have
a 9% 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 $5,000 for a down payment on a new car. The
largest monthly payment you can afford is $450. The loan will have
a 9% APR based on end-of-month payments.
What is the most expensive car you can afford if you finance it
for 48 months? Do not round intermediate calculations. Round your
answer to the nearest cent.
$
What is the most expensive car you can afford if you finance it
for 60 months? Do not round...

You have saved $5,000 for a down payment on a new car. The
largest monthly payment you can afford is $400. 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.

You have saved $5,000 for a down payment on a new car. The
largest monthly payment you can afford is $350. The loan will have
a 9% 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 $5,000 for a down payment on a new car. The
largest monthly payment you can afford is $500. 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 $3,000 for a down payment on a new car. The
largest monthly payment you can afford is $300. The loan will have
a 10% APR based on end-of-month payments.
What is the most expensive car you can afford if you finance it
for 48 months? Do not round intermediate calculations. Round your
answer to the nearest cent.
I am doing this assignment all in excel. The book mentioned
to use the "PV" function, but I am stuck...

Problem 5.26
PV AND LOAN ELIGIBILITY
You have saved $3,000 for a down payment on a new car. The
largest monthly payment you can afford is $400. The loan will have
a 8% APR based on end-of-month payments.
a. What is the most expensive car you can afford if you finance
it for 48 months? Do not round intermediate calculations. Round
your answer to the nearest cent.
b. What is the most expensive car you can afford if you finance...

PV AND LOAN ELIGIBILITY
You have saved $4,000 for a down payment on a new car. The
largest monthly payment you can afford is $350. The loan will have
a 8% APR based on end-of-month payments.
What is the most expensive car you can afford if you finance it
for 48 months? Do not round intermediate calculations. Round your
answer to the nearest cent.
$
What is the most expensive car you can afford if you finance it
for 60...

PV AND LOAN ELIGIBILITY
You have saved $5,000 for a down payment on a new car. The
largest monthly payment you can afford is $400. The loan will have
a 8% APR based on end-of-month payments.
What is the most expensive car you can afford if you finance it
for 48 months? Do not round intermediate calculations. Round your
answer to the nearest cent.
What is the most expensive car you can afford if you finance it
for 60 months?...

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