#1**+1 **

Here's what I get, NSS

For a new car

P = 350

r = .0279/12

n = 72

A = 350 [ (1 + .0279/12)^72 - 1 ] / [(.0279/12) ( 1 + .0279/12)^72 ] ≈ $ 23,178.95

For a used car only r is different....it is (.0329/12)

So we have

350 [ (1 + .0329/12)^72 - 1 ] / [(.0329/12) ( 1 + .0329/12)^72 ] ≈ $ 22,840.34

CPhill
Oct 15, 2018

#2**+1 **

CPhill: You made a small error in that Tyresa "wants to buy a car but doesn't want to spend more than $350 a month **FOR A MAXIMUM OF FOUR YEARS**". That is the term is for 48 months. The rates offered by the bank are for** UP TO 72 MONTHS.**

At any rate, here are the amounts worked out for 48 MONTHS:

1) Maximum amount to borrow for a new car @ 2.79%, $350 per month, for 4 years or 48 months.

The amount =**$15,879.04.** Use the formula given to you to get this amount.

2) Maximum amount to borrow for a used car @ 3.29%, $350 per month, for 4 years or 48 months.

The amount=**$15,721.34.** Again, use the formula given to you to get this amount.

**Note: As you can see, there is very little difference between the two, because the difference in interest rates is very small, 0.5%. **

Guest Oct 15, 2018

#4

#5**0 **

For the new car it would be 9196.52? and for used car it would be 8388.86 dollars?

NotSoSmart
Oct 17, 2018