1. Linda wants to buy a house with a sales price of $300,000. She doesn't think she can pay more than $16,900 a year on a loan payment. A bank will make her a loan at 3% for 25 years with annual payments. Can she afford to buy the house? Why?

2. Sara bought a Lexus RX 350 four years ago. She paid $63,999.00 and financed it for five years at 4.00% interest with annual payments. She just made her 4th year payment. She wants to trade it in for a new Lexus. How much is the pay off on her Lexus?