Judy has just received $ 12,500 as an inheritance from her uncle and is considering ways to use the money. Judy’s car is one year old, and her monthly payment is $ 304. She owes 48 more payments. The amount to pay off the loan is $ 12,460. How much will Judy save in interest if she pays off her car loan now?
Answer to relevant QuestionsHow do your current financial position and goals relate to your creation of alternative financial plans? What is liquidity? What two factors are considered in managing liquidity? How are they used? How do you think people who do not create a budget may deal with cash deficiencies? How can this affect their personal relationships? Judy (from problem 1) is also considering investing the $ 12,500 in a certificate of deposit (CD). She is guaranteed a return of 4% on a four year CD. How much would Judy earn from the CD? Which of the two alternatives ...In what ways are the Sampsons’ financing and investing decisions related? What should they do in the future before asking advice from investment advisers?
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