You are debating whether to either purchase a car or continue to take public transportation and taxis
Question:
You are debating whether to either purchase a car or continue to take public transportation and taxis at an annual cost of \(€ 6,000\) to get where you want to go. The purchase price of the car you are interested in is \(€ 24,000\), and you estimate the annual expense of operating it (maintenance, gas, and parking) is \(€ 2,600\). If the nominal interest rate is \(5 \%\) and the rate of inflation is \(2 \%\) each year, how long would you have to own the car before your investment paid off?
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To determine how long you would have to own the car before your investment pays off we need to calcu...View the full answer
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