1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
bija089 [108]
3 years ago
7

You want to buy a new car, but you can make an initial payment of only $2,400 and can afford monthly payments of at most $500. a

. If the APR on auto loans is 12% and you finance the purchase over 48 months, what is the maximum price you can pay for the car?
Business
1 answer:
dlinn [17]3 years ago
7 0

Answer:

Ans. The maximum price you can pay for the car is $21,387

Explanation:

Hi, to find out what is the maximum price that you can pay, first we have to convert APR rate to an effective monthly rate, that is because you will make the payments in an monthly basis.

Therefore, the effective monthly rate of the credit is 12%/12 =1% effective monthly.

Now, let´s find out the maximum price of the car.

CarPrice=\frac{A((1+r)^{n}-1) }{r(1+r)^{n} } +DownPayment

Where: A is the amount of money that you can pay every month; r is 1% effective rate; n is the periods of periodic payment.

So, everything should look like this:

CarPrice=\frac{500((1+0.01)^{48}-1) }{0.01(1+0.01)^{48} } +2,400= 21,387

So, with a down payment of $2,400 and being able to pay $500 per month, the car that you can buy cannot have a price higher than $21,397.

Best of luck

You might be interested in
Both Nadia and Samantha are applying to insure their car against theft. Nadia lives in a secure neighborhood, where the probabil
Sergio039 [100]

Answer:

Option B

Explanation:

Both Nadia and Samantha have insured their cars and willing to pay $100 over the expected loss for insurance. If the car is stolen the company would pay expected loss and would earn nothing and if the car is not stolen the company would not be liable for any loss and would earn $200, Therefore the company would earn between $0 and $200.

3 0
3 years ago
Which of the following housing decisions provides a person with both
Lana71 [14]
C selling a share in cooperative
3 0
3 years ago
Read 2 more answers
Comprehensive income is defined as: Net income plus other comprehensive income. Changes in equity for a period resulting from al
SVEN [57.7K]

Answer: Changes in equity for a period from all sources except those by non-owner sources.                            

Explanation: In simple words, comprehensive income refers to those transactions that were not realized before so they later get recorded in the income statement.

These transactions usually results in increase in shareholders equity. Usually such transactions involve unrealized gain or loss from available for sale securities or foreign currency transactions.

8 0
3 years ago
Banks make a profit by
Neporo4naja [7]
When people take money out of the bank, they have to pay them back with a little more and interest is why.<span />
7 0
3 years ago
Read 2 more answers
New Coffee Company, LLC uses JIT (just-in-time) logistical supply methods. This indicates that the company doesn't really keep l
Leona [35]

Answer:

B) Inventory turnover ratios

Explanation:

Inventory turnover measures how many times a business sells and replaces its merchandise or materials inventory during an accounting period, usually a year.

One of the basic goals of JIT is to lower the total inventories in a company, therefore increasing the inventory turnover ratio. This reduces the company's operating costs.

4 0
3 years ago
Other questions:
  • Greg's Copy Shop bought equipment for $60,000 on January 1, 2006. Greg estimated the useful life to be 3 years with no salvage v
    13·1 answer
  • In order to be​ effective, a persuasive​ ________ should include a thorough and detailed review of the​ facts, and be written in
    9·1 answer
  • Exercise 18-12 Computing sales to achieve target income LO C2 Blanchard Company manufactures a single product that sells for $31
    5·1 answer
  • Meredith saves $575 a month and her gross income is $6,500 each month. Meredith’s liquid assets are equal to $4,000 and her curr
    14·1 answer
  • 1. Your roommate's long hours in chem lab finally paid off--she discovered a secret formula that lets people do an hour's worth
    15·1 answer
  • June 4 Deere Company purchased $3,500 worth of merchandise, terms n/30 from Gilbert Company. The cost of the merchandise was $2,
    6·1 answer
  • Because the _____ is the rational part of the personality, it sometimes plays referee between the wishes of the _____ and the __
    11·1 answer
  • In the short run a) a firm does not have sufficient time to change any of the resources it uses. b) a firm does not have suffici
    15·1 answer
  • In 2005, mandy and hal (mother and son) purchased land for $600,000 as joint tenants with right of survivorship. of the $600,000
    5·1 answer
  • HELP ME PLEASE************
    10·2 answers
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!