1. A Volvo car dealer wishes to sell a 1995 Volvo 740 GLE to a customer for $10,000.00 which includes the sales tax. The customer can only make a down payment of 20% of the total cost of the car at the time of the sale. The customer has gone to his bank to finance the rest of the purchases. The bank charges 14% annual interest rate on all car notes to its customers. If the bank requires this customer to pay a monthly car note of $222.40 find: a. The number of months required for the customer to pay off the car loan. (Hint: The months must be an integer number). b. The amount required to pay off the loan at the end of the 8th month.

1. A Volvo car dealer wishes to sell a 1995 Volvo 740 GLE to a customer for $10,000.00 which includes the sales tax. The customer can only make a down payment of 20% of the total cost of the car at the time of the sale. The customer has gone to his bank to finance the rest of the purchases. The bank charges 14% annual interest rate on all car notes to its customers. If the bank requires this customer to pay a monthly car note of $222.40 find: a. The number of months required for the customer to pay off the car loan. (Hint: The months must be an integer number). b. The amount required to pay off the loan at the end of the 8th month.

Economics Today and Tomorrow, Student Edition

1st Edition

ISBN:9780078747663

Author:McGraw-Hill

Publisher:McGraw-Hill

Chapter4: Going Into Debt

Section: Chapter Questions

Problem 29AA

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