13. You decide you'd like to buy a Nissan Leaf electric car, but you don't have enough money. You have two choices: 1) Lease a Leaf at $340.31 per month for 3 years, with a cash down payment of $2,000, and then return the car to the dealer, or 2) Take out a loan with monthly payments at 8% annual compound interest and buy the car now for $28,140 minus a cash down payment of $2,000. 13a. 13b. How long a loan term would result in your making the same monthly payment as for the lease? Over the course of said loan, how much interest would you have paid?

13. You decide you'd like to buy a Nissan Leaf electric car, but you don't have enough money. You have two choices: 1) Lease a Leaf at $340.31 per month for 3 years, with a cash down payment of $2,000, and then return the car to the dealer, or 2) Take out a loan with monthly payments at 8% annual compound interest and buy the car now for $28,140 minus a cash down payment of $2,000. 13a. 13b. How long a loan term would result in your making the same monthly payment as for the lease? Over the course of said loan, how much interest would you have paid?

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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Similar questions

Someone offers to buy your car for four, equal annual payments, beginning 2 years from today. If you think that the present value of your car is $9,000 and the interest rate is 10%, what is the minimum annual payment that you would accept? How to solve this problem on BAII Plus Why is this not $ 3435.48, the answer is $3,123.16, I am using the BAll Plus calculator and don't know what variables I am misinputting especially after I finish the first step to get the PV of the car after 2 years which is 10,890.00
You have decided to buy a car, the price of the car is $18,000. The car dealer presents you with two choices: Purchase the car for cash and receive $2000 instant cash rebate – your out of pocket expense is $16,000 today. Purchase the car for $18,000 with zero percent interest 36-month loan with monthly payments. The market interest rate is 4%. Which of the option above is cheaper? How much do you save? Formula attached
Suppose that you have decided to buy a certain car that costs $28,950, including taxes and license fees. The dealership gives you two financing options: 1) Option A: The dealership takes $800 off the price of the car. You must make a down payment of $2000 and can finance the rest at 2.99% APR for 72 months. a) How much will you be financing? b) How much will your monthly payments be under this option? (Round to the nearest dollar.) c) How much total money will you pay under this option? (Don’t forget to include your down payment.) 2) Option B: The dealership takes $1000 off the price and 0% financing for 36 months. a) How much will you be financing? b) How much will your monthly payments be under this option? (Round to the nearest dollar.) c) How much total money will you pay under this option? 3) Would you choose option A or option B? Why?
You have decided to buy a car with price tag of $30,000 but you are able to negotiate the price down to $28,000. You have $1,000 saved, so you need to borrow $27,000 in a 5-year loan from your bank (your bank offers lower rates than the auto-dealer) at a 3% APR (annual rate). How much will you owe to the bank after 2 years?
Suppose you want to become a Lyft driver and need to lease a car. You want a car valued at $22,000. The dealer will let you drive away with no money down. You sign a 5 year lease with monthly payments. The imbedded discount rate on the lease is 6%. At the end of the fifth year, you would need to pay a residual value payment of $5,255.19 in order to take ownership of the car. What is the required monthly payment? Round to the nearest $ and use the $ symbol.
You have decided to purchase a new car that costs $44,500. You need to make a 20% down payment, then you will finance the rest with a loan. Your bank will extend you a car loan where the APR is 4.32% and you will make monthly payments over five years. What is the monthly payment on the vehicle? O $593.33 O $660.78 O $512.79 O $825.98
You are planning to buy an used car from a local dealer. The list price of the car is $12,000. If you pay cash, the cost of car is $11,000. The dealer also offers you the choice of paying $5,500 down with 3 equal year-end payment of $2,100. You have $5,500 cash. If you prefer, you can borrow the rest from your bank with a personal loan of 10% interest rate. What is the dealer's implied interest rate? Do you accept the dealer credit sale or borrow from the bank? List price of car Downpayment Cash cost of car Bank rate of interest Year 0 1 2 3 12,000 5,500 11,000 10% Payment in cash -11,000 0 0 0 Payment with credit -5,500 -2,100 -2,100 -2,100 Cash spent or saved with credit plan 5,500 -2,100 -2,100 -2,100
You are considering buying a new car. The sticker price is $15,000 and you have $2,000 to put toward a down payment. If you can negotiate an annual interest rate of 10 percent and you wish to pay for the car over a 5-year period, what are your monthly car payments? O $276.21 O $318.71 O $282.34 O $361.20 O $299.78
You need to purchase a car, but don’t have the money to buy it outright. Therefore, you’ll have to borrow money for a loan. Your current situation is this:• The car you want to buy costs $11,999• You have $5500 saved for a down payment on the car.• The dealer offers add-on interest loans for 7% per year, for 1, 3, or 5 years.• You want to keep your car payments under $250 per month.(a) Calculate the monthly payments for 1, 3, or 5 years. Can you afford any of these loan terms?Explain.(b) Compute the total interest you’ll pay over the life of each loan
Suppose that you decide to buy a car for $60,000, including taxes and license fees. You saved $11,000 for a down payment. The dealer is offering you a choice between two incentives. Incentive A is $4000 off the price of the car, followed by a five-year loan at 6.04%. Incentive B does not have a cash rebate, but provides free financing (no interest) over five years. P What is the difference in monthly payments between the two offers? Which incentive is the better deal? Use PMT = nt 1- 1+ The difference in monthly payments between the two offers is $| (Round to the nearest cent as needed.) This question has not been completed
You are selling your car and the dealership says to you, "we can either give you $15,000 today or we can give you $5,000 per year starting one year from now for the next 4 years." At what interest rate are you indifferent? (i.e. what interest rate is being provided here?) Choose the closest. a) 18.8% b) 33.3% c) 12.6% d) 6.7%
A car dealer offers to buy your car for $9,500 so that you can purchase a new one. If your monthly payment is $464.23 with an annual interest rate of 3.9% and you have 20 more payments remaining, is the present value of your car loan more or less than the amount the dealer is offering? How much Less?

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