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What is the most expensive computer he can purchase

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An engineering student intends to purchase a new computer. He plans to pay $300 down and finance the remainder over a 12 month period. The maximum amount that he can repay each month is $100.

a. What is the most expensive computer he can purchase, assuming an interest rate of 2% per month (compounded monthly)?

b. Draw the Cash Flow Diagram for this problem.

Reference no: EM131850838

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