You can buy an advertised car for $25,440 under the following conditions: (a) pay $25,440 and get

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You can buy an advertised car for $25,440 under the following conditions:

(a) pay $25,440 and get $5,440 off the manufacturer;

(b) pay $530 per month for 4 years for a total of $25,440 in zero percent financing.

A.	If the interest rate is 1.00% per month, calculate the present value of the payments for option (a).

value today

B.	If the interest rate is 1.00% per month, calculate the present value of the payments for option (b). (Do not round intermediate calculations. Round your answer to 2 decimal places.)

value today

Which is the better deal?

	option b
	Option one

Related Book For answer-question

Personal Finance An Integrated Planning Approach

ISBN: 978-0136063032

8th edition

Authors: Ralph R Frasca

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Posted Date: Mar 16, 2023 07:25 AM

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You can buy an advertised car for $25,440 under the following conditions: (a) pay $25,440 and get

Question:

Expert Answer:

A To calculate the present value of option a we need to find the present value of the 5440 discount ... View the full answer

Personal Finance An Integrated Planning Approach

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