Question: Please solve using formula, NOT EXCEL. Jax buys a motorcycle that has a purchase price of 16,000 . Prevailing market rates are at 6% compounded

Please solve using formula, NOT EXCEL.

Please solve using formula, NOT EXCEL. Jax buys a motorcycle that has

Jax buys a motorcycle that has a purchase price of 16,000 . Prevailing market rates are at 6% compounded monthly. The dealership offers him the following choices: (i) Take a cash rebate of X and use the current market rate, i.e. the loan amount will be 16000X (ii) No rebate and use an interest rate of 2.25% compounded monthly, i.e. the loan amount will be 16000 . Either way, the loan is to be repaid over four years with level monthly payments, the first of which is due one month after the purchase of the motorcycle. The amount of rebate is set so that the dealership is indifferent as to whether Jax takes the rebate or finances the motorcycle at the offered below-market interest rate. Determine the amount of the rebate, X

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