andie needs to borrow $6,000 to buy a car. one dealer offers her a monthly payment of $193.60 on a 3-year loan with an apr of 10

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andie needs to borrow $6,000 to buy a car. one dealer offers her a monthly payment of $193.60 on a 3-year loan with an apr of 10

percent while another dealer offers her a monthly payment of $158.00 on a 4-year loan with an apr of 12 percent. if she can afford to make either payment, which loan costs less overall?

Business

1 answer:

Kitty [74] · Answer 1 · 2023-08-23T07:47:14+03:00

Given the above stated information, the the correction options is C. Three year loan costs less than 4 year loan.

<h3>What is a the calculations justifying the above answer?</h3>

The computation is executed using excel. Here is the explanation for same:

There are two loan choices available. We must calculate the total payments for both alternatives and choose the one with the lowest cost.
The first option is to pay $193.60 per month with 10% interest for 3 years.
The second option is to pay $158 per month for four years at 12% interest.
Total cost for option 1 is $969.60.
Total cost for option 2 is $1584.00.

Hence from

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