Estimate the price of the car at the end of eight years

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Reference no: EM132028503

Time value Personal Finance Problem As part of your financial planning, you wish to purchase a new car exactly 8 years from today.

The car you wish to purchase costs $18,000 today, and your research indicates that its price will increase by 3% to 6% per year over the next 8years.

a. Estimate the price of the car at the end of 8years if inflation is (1) 3?% per year and (2) 6?% per year.

b. How much more expensive will the car be if the rate of inflation is 6% rather than 3?%

c. Estimate the price of the car if inflation is 3% for the next 2years and 6% for 6years after that.

a. The price of the car at the end of 8years, if inflation is 3?% per year, is $ (Round to the nearest cent.)

Reference no: EM132028503

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