Question: [3 pts] Consider the simple loan case. Suppose that the dealership allows you to pay the car off in four installments of $5,000, with each
[3 pts] Consider the simple loan case. Suppose that the dealership allows you to pay the car off in four installments of $5,000, with each installment due once a year. The first payment is due the day that you purchase the car; the remaining installments are then paid on the same date each consecutive year, for the remaining three years. What is the present discounted value of the payments you make for the car?
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