Suppose that you drive 24,000 miles per year and gas averages $4 per gallon. a. What will you save in annual fuel expenses by owning a hybrid car averaging 50 miles per gallon rather than an SUV averaging 12 miles per gallon? b. what is your monthly fuel saving? c. If you deposit your monthly fuel savings at the end of each month into an annuity that pays 7.3% compounded monthly, how much will you have saved at the end of six years?

Suppose that you drive 24,000 miles per year and gas averages $4 per gallon. a. What will you save in annual fuel expenses by owning a hybrid car averaging 50 miles per gallon rather than an SUV averaging 12 miles per gallon? b. what is your monthly fuel saving? c. If you deposit your monthly fuel savings at the end of each month into an annuity that pays 7.3% compounded monthly, how much will you have saved at the end of six years?

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter11: Capital Budgeting Decisions

Section: Chapter Questions

Problem 5MC: If you are saving the same amount each month in order to buy a new sports car when the new models...

See similar textbooks

Similar questions

You want to save money from your businessoperation to replace a truck that has been used indelivery. The truck will be replaced after 12 yearsfrom now and the replacement cost would be about$60,000. If you earn 5% interest on your savings,how much must you deposit at the end of each yearto meet the needs?
Suppose you have selected a new car to purchase for $19,500. If the car can be financed over a period of 4 years at an annual rate of 6.9% compounded monthly, how much will your monthly payments be? Use excel
How much do you need to save each year for 30 years in order to have $775,000, assuming you are investing the money in an account that earns 8%? How much of the $775,000 comes from contributions (your out of pocket costs)?
Suppose you want to save in order to purchase a new car. Take the APR to be 3.6%. If you deposit $250 each month, how much will you have towards the purchase of a car after 2 years?
You are looking to purchase a new car, and you expect to have annual maintenance costs to keep it running. According to your calculations, you expect to incur $150 maintenance costs in the first year and expect the costs to increase by $100 for the next 7 years. You plan to keep the car for 8 years in total. How much money should you have in your savings account today, so that you do not have to worry about maintenance? The savings account pays 2% per year, compounded annually.
You are planning to buy a new car/truck (of your dreams) 7 years’ time at a cost of $134,956. How much will you need to save each month to be able to buy the car with cash assuming an annual interest rate of 10%?
You are saving money to buy a car. If you save $310 per month starting one month from now at an interest rate of 6%, how much will you be able to spend on the car after saving for 4 years?
suppose you are planning to buy a home in 8 years from now that costs you 47114 OMR, How much should you save each year in your bank account that pays 6.012 percent to reach your goal?
Suppose you would like to save enough money to pay cash for your next car. The goal to save an extra $26,000 over the next 6 years. What amount of quarterly payments must you make into an account that earns 5.5% interest in order to reach your goal?
You are saving for a Porsche Carrera Cabriolet, which currently sells for nearly half a million dollars. Your plan is to deposit $61,000 at the end of each year for the next 6 years. You expect to earn 11 percent each year. Required: 1. Determine how much you will have saved after 6 years. 2. Determine the amount saved if you were able to deposit $64,000 each year. 3. Determine the amount saved if you deposit $61,000 each year, but with 13 percent interest.
You want to save the down payment required to purchase a vacation home at the end of four years. If the required down payment is $75,000 and you can earn 6% a year on your savings account, how much do you need to set aside at the end of each year for the next four years?
You are saving for a Porsche Carrera Cabriolet, which currently sells for nearly half a million dollars. Your plan is to deposit $30,700 at the end of each year for the next 10 years. You expect to earn 10 percent each year. Required: 1. Determine how much you will have saved after 10 years. 2. Determine the amount saved if you were able to deposit $33,200 each year. 3. Determine the amount saved if you deposit $30,700 each year, but with 12 percent interest. (Future Value of $1,Present Value of $1, Future Value Annuity of $1, Present Value Annuity of $1.) Note: Use appropriate factor(s) from the tables provided X Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Determine how much you will have saved after 10 years. Note: Round your final answer to the nearest whole dollar. Balance in the Savings Account $ 490,483