Part 2 Integrative Data Case This case draws on material from Chapters 3-7. Adam has just graduated, and has a good job at a decent starting salary. He hopes to purchase his first new car. The car that Adam is considering costs $47,000. The dealer has given him three payment options: 1. Zero percent financing. Make a $2,800 down payment from his savings and finance the remainder with a 0% APR loan for 60 7 months. Adam has more than enough cash for the down payment, thanks to generous graduation gifts. 8 2. Rebate with no money down. Receive a $5,000 rebate from the car dealer and finance the rest with a standard 60-month loan, 9 with an 4.95% APR. He likes this option, as he could think of many other uses for the $2,800 of his saving. 10 3. Pay cash. Get the $5,000 rebate and pay the rest with cash. While Adam doesn't have balance of the car cost in hand, he 11 wants to evaluate this option. His parents always paid cash when they bought a family car, Adam wonders if this really was a good 12 idea $47,000 NOTE: Use this information to solve the data case in addition to other Car cost Loan Termin months Option 1 Down Payment Option 2 and 3 Rebate Option 2 Loan rate Deposit Interest Rates as Glven in Text (pe 222-223) $2.800 $5,000 4.95% Question 1 (12 pts: Down Payment Amount Financed Interest Rate (APR) Loan Term months) Monthly Payment Option 1- Zero percent financing Option 2 - Rebate w/ 50 down Option 3 - Pay cash MONTHLY CASH FLOWS: Cash flow for Month Cash flow for Month 1 to 48 Option 1- Zero percent financing Option 2 - Rebate w/ $0 down Option 3 - Puy cash Down Payment Question 2 (12 pts PV of Car Financing at Deposit A Mich option should he select? Option 1 Option 2 Option Part 2 Integrative Data Case This case draws on material from Chapters 3-7. Adam has just graduated, and has a good job at a decent starting salary. He hopes to purchase his first new car. The car that Adam is considering costs $47,000. The dealer has given him three payment options: 1. Zero percent financing. Make a $2,800 down payment from his savings and finance the remainder with a 0% APR loan for 60 7 months. Adam has more than enough cash for the down payment, thanks to generous graduation gifts. 8 2. Rebate with no money down. Receive a $5,000 rebate from the car dealer and finance the rest with a standard 60-month loan, 9 with an 4.95% APR. He likes this option, as he could think of many other uses for the $2,800 of his saving. 10 3. Pay cash. Get the $5,000 rebate and pay the rest with cash. While Adam doesn't have balance of the car cost in hand, he 11 wants to evaluate this option. His parents always paid cash when they bought a family car, Adam wonders if this really was a good 12 idea $47,000 NOTE: Use this information to solve the data case in addition to other Car cost Loan Termin months Option 1 Down Payment Option 2 and 3 Rebate Option 2 Loan rate Deposit Interest Rates as Glven in Text (pe 222-223) $2.800 $5,000 4.95% Question 1 (12 pts: Down Payment Amount Financed Interest Rate (APR) Loan Term months) Monthly Payment Option 1- Zero percent financing Option 2 - Rebate w/ 50 down Option 3 - Pay cash MONTHLY CASH FLOWS: Cash flow for Month Cash flow for Month 1 to 48 Option 1- Zero percent financing Option 2 - Rebate w/ $0 down Option 3 - Puy cash Down Payment Question 2 (12 pts PV of Car Financing at Deposit A Mich option should he select? Option 1 Option 2 Option