Question

Car payments are determined using simple interest. If you don’t remember this formula, go back and look it up! To finance your vehicle purchase you have two choices. Write two equations, one for each bank, that models the banks' loan options using x for the price of the vehicle and y to represent the total cost (price, interest and origination fees) paid on each loan. Be sure to label which equation goes with which bank. Bank A: Finance the full price of the vehicle at 5% with an origination fee of $300 paid over 5 years. Bank B: Finance the full price of the vehicle at 3.5% paid over 6 years (no additional fees).

Answer 1

Answer:

Bank B for the car loan and Bank A for the savings account

Explanation:

The reason why this would be your answer is because when you are opening a savings account, you want to make sure that the interest is high. However, when you get a new car, you want to make sure that the interest is low. Bank B provides a low interest rate, while Bank A provides a high interest rate.

Why are the two the opposite? Here's the answer:

Why you should get a high interest rate for a savings account:

You should get a high interest rate for the savings account because the interest you have for the savings account is the money that the bank will give you, so it's pretty much free money that the bank is giving you for having your money saved in their bank. If you want to get more money from the bank because of your savings account, then you should find one with a high interest rate