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Receive the equivalent of normal selling price

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Reference no: EM133114250

You work for a used car dealership. The normal selling price of a particular car is $4,000 when paid in full in cash at the time of the sale. Just for today, you are planning to run a zero-interest financing 'sale' during which you will allow the customer to make 24 equal monthly payments, interest-free, beginning a month from today. During the '0% sale', you will change the sticker price of the item. Your cost of capital is 24% APR (compounded monthly). During the '0% sale', what would the sticker price have to be in order for you to receive the equivalent of your normal selling price?

Reference no: EM133114250

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