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An auto dealership is advertising that a new car with a sticker price of $ 3 4 , 8 4 8 is on sale for
An auto dealership is advertising that a new car with a sticker price of $ is on sale for $ if payment is made in full, or it can be financed at interest for months with a monthly payment of $ Note that payments times $ per payment $ which is the sticker price of the car. By allowing you to pay for the car in a series of payments starting one month from now rather than $ now, the dealer is effectively loaning you $ If you choose the financing option, what is the effective interest rate that the auto dealership is earning on your loan? Hint: Discount the payments back to current dollars, and use Goal Seek to find the discount rate that makes the net present value of the payments $
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