You are considering two cars that you plan on making for 5 years. One has an EPA combined city and highway rating of 33 mpg. The second has an EPA rating of 36 mpg. Suppose gasoline costs $3.47 per gallon and you drive $10,000 miles each year. (Round your answer to the nearest cent.) (a) How much (in dollars) will you save in 1 year by purchasing the 36 mpg car? (b) If you deposit that amount at the end of each year for 5 years of ownership into account that earns 4.8% compounded annually, how much (in dollars) will you save over 5 years?

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A: Down payment=$2000Price of car=28140Interest rate=8%Monthly payment=$340.31

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A: A loan is a debt arrangement that provides financial assistance to a person to full fill a specific…

Q: You would like to buy a new car. The car costs will be $81 500. If you can earn 12% per annum, how…

A: Future value is $81,500. Rate per annum is 12%. Time period is 3 years.

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A: An Annuity is a continuous flow of systematic timely cash flows made or received for a stipulated…

Q: You plan to purchase a car for $28,000. Its market value will decrease by 20% per year. You have…

A: Given:C = $28,000r=20%=0.20M = $0.485 (mileage reimbursement rate in the 1st year)g=10%=0.10m=15,000…

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A: Formula: Future value = (Amount*((1+rate)^years -1)/Rate

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A: You will buy the car after 5 years.The car costs = $35,600henceYou need $35,600 after 5 years.You…

Q: We have offered to contribute $6,200 at the time of your purchase. The car plan to buy will cost…

A: Annuity means a series of finite number of payments which are the same in size and occur in the same…

Q: Suppose that you drive 24,000 miles per year and gas averages $4 per gallon. a. What will you save…

A: This is a case of financial analysis of fuel costs. Fuel costs depends on two factors – no. of miles…

Q: Consider a hybrid vehicle with a price of $30,000. This vehicle will average 30 miles per gallon of…

A: Data given:   Hybrid Vehicle: Price=$ 30,000 Average miles per gallon of gasoline=30   Gasoline only…

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A: We have to calculate present value of both option to compare which option is preferable.

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A: Variables in the question:Cost of motorcycle=$14,000Selling price=$8400Annual mileage=28000…

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A: Monthly payment refers to an amount that is being paid at every month for the repayment of the…

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A: To determine the maximum car price, we need to find the PV of the monthly payment and then add the…

Q: All other factors remain the same and assuming the gasoline costs $4.00 per gallon.

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Q: ly, how long Will you Have logies!) В years. 2 years. ars

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Q: You are considering buying a new car worth $I5,000. You can finance the car either by withdrawing…

A: The present worth an investment is based on the time value of money concept. The present value of…

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

A: The FV of an investment refers to the combined worth of the cash flows of the investment at a…

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A: Insurance is an agreement that allows the transfer of the risk or loss to the insured for the…

Q: 5) You are considering buying a Chevy Cruze. The sticker price is $15,000 and you have $2,000 to put…

A: Car price = $15,000Down payment = $2,000Interest rate = 10%Number of years = 5 years

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A: A series of payments made over a period at equal intervals of time is known as annuity. The future…

Q: You just got your first engineering job. How much money would you have to save per vest the money…

A: Since the same amount is needed to be saved per month, it is an annuity. The future value of annuity…

Q: Your friend is willing to buy your Ford F-150 in 4 years. You bought the truck for $50,000 and he is…

A: Cost of Truck $50,000 Selling Price after 4 years ($50,000 * 60%) $30,000 Present value of $1 at…

Q: You hope to buy your dream car four years from now. Today, that car costs $54,500. You expect the…

A: Future value is the value of the current assets or some amount that is invested today and amount…

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A: A concept that implies the future worth of the money is lower than its current value due to several…

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A: Part a: The most you can borrow.To find out the most you can borrow, you first need to calculate the…

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Q: Sarah and Robert want to know how much it will cost to buy a sport car in 10 years. Cars similar to…

A: Inflation is the increase in prices of goods and services and inflation decreases purchasing power…

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A: The Future Value (FV) of an annuity refers to the total value of a series of equal cash flows…

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A: Present value is the value of the money in present times which is expected to be received in some…

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A: In this we need to calculate present value of rental and salvage and compare with cost of car.

Q: After years of working hard and finally becoming a millionaire, you would like to reward yourself by…

A: Discounting the future value (FV) provides present value(PV).

Motor Vehicle Insurance

Motor vehicle insurance is a contract between the insurance company that provides insurance cover and the person who owns the vehicle. According to the terms and conditions of the insurance contract, the insurance company reimburses the policyholder for losses and damages. This insurance policy covers the financial risks of the motor vehicle owner. Electronic vehicles are also covered in a vehicle insurance policy, but the insurance rate is relatively higher than other motor vehicle insurance. Motor vehicle insurance is otherwise called an automotive insurance policy.