User Account

All Pages

Find the monthly payment under plan i

Assignment Help Finance Basics
Reference no: EM132370462

At the GM dealership, you find a car priced at $17,195. There are two special purchase plans. Plan I: After making a down payment of $5,000, you can finance the purchase at an APR (annual percentage rate) of 2.4% compounded monthly. Plan II: The dealer gives you a discount ("rebate") of $800 on the purchase price (so that your purchase price is $17,195 - $800). However, the annual financing rate will be an APR of 8.4% also compounded monthly, and the required down payment is $5,600. Assume that, under either plan, you will finance your car purchase over 3 years. Also assume that the effective annual interest rate is 5% (that is the EAR of a similar loan in the market). The payments are made at the end of each month.

a) Find the monthly payment under Plan I.

b) Find the monthly payment under Plan II.

c) Which plan should you choose? Show you reasoning.

Reference no: EM132370462

Questions Cloud

Post description of the importance of the use of theory : As a social work student, it is important to understand the need for theory-informed practice. As you assess, intervene, and evaluate in your practice.
What is the credit card ear : A credit card offers an APR of 22%. If the actual interest is compounded monthly, what is the credit card's EAR?
Discuss health promotion-disease prevention : Investigate programs globally that are attempting to address health promotion/disease prevention in areas with high poverty. Make a graphic with a minimum.
What is the present value of stream of cash flows : If the interest rate is 12 percent, what is the present value of this stream of cash flows? If the issuer offers this investment for $1,500, should you purchase
Find the monthly payment under plan i : a) Find the monthly payment under Plan I. b) Find the monthly payment under Plan II. c) Which plan should you choose? Show you reasoning.
What ethical theory best applies to your experience : You began this session considering a moral-ethical dilemma you yourself faced that you either resolved or failed to resolve, but hopefully learned from.
What will the dividend be in five years : Suppose a stock currently pays a dividend of $1.10, which is expected to grow at 40 percent per year for the next five years. What will the dividend be in five
Insert the plan records and screening records into database : CP5503 Enterprise Database Systems Oracle Assignment - Trigger, James Cook University, Australia. Insert the plan records and screening records into database
Choosing a business location : List the key factors needed for consideration in choosing a business location? Why is location a key factor for most brick and mortar businesses?

Reviews

Write a Review

Finance Basics Questions & Answers

  How the liabilities affected the basic accounting equation

Assume $25 million was actually spent in 2009 to remediate environmental problems. Draw a T-account and reconstruct 2009 changes for contingencies.

  Guidelines for use of color in interface design

Question: What are some of the guidelines for use of color in interface design?

  Calculate how much has to be in your account

Calculate how much you would have to save annually between now and age 63 in order to finance your retirement income and to fill that account.

  Prepare journal entries to record transactions and events

Clarion contractors finished the given transactions and events. Jan 1 paid 255440 cash plus 15200 in sales tax and 2500 in transportation fees for a new loader.

  Messman manufacturing will issue common stock to the

messman manufacturing will issue common stock to the public for 30. the expected dividend and growth in dividends are

  Global marketing-economic consideration

Since global marketing is affected by economic considerations, a scan of the global marketplace should include this factor:

  Are native americans portrayed the way in the media

Are Native Americans portrayed the way in the media or are they stereotyped as a homogeneous group?

  Calculate the amount of the shareholders loss

Did the firm's shares lose value or gain value between yesterday and today? Calculate the amount of the shareholders loss or gain.

  Does this mean the project is acceptable

International Capital Budgeting An investment in a foreign subsidiary is estimated to have a positive NPV, after the discount rate used in the calculations is adjusted for political risk and any advantages from diversification.

  Compute today price of the stock

1. Suppose the company just paid dividend of $1. The dividends are expected to grow at 20% in Year 1 and 15% in Year 2. After that, the dividends will grow at a constant rate of 5% forever. If the required rate of return is 10%, compute today's pr..

  Different accounting treatment for series a preferred stock

The following excerpts are taken from the annual report of J. Crew Group, Inc. At January 29, 2005 and January 28, 2006, 92,800 shares of Series A preferred.

  Why would a firm issue convertible securities

Why would  a firm issue convertible securities?What are the advantages and disadvantages of issuing convertible securities?What are benefits to a firm towrd issuing standard bonds or prefered securitis?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd