Question
Please show works! 1. To buy his favorite car, Larry is planning to accumulate money by investing his Christmas bonuses for the next five years
Please show works!
1. To buy his favorite car, Larry is planning to accumulate money by investing his Christmas bonuses for the next five years in a security which pays a 10 percent annual rate of return. The car will cost $20,000 at the end of the fifth year and Larry's Christmas bonus is $3,000 a year. Will Larry accumulate enough money to buy the car? How much additional will he either need or have?
2. Marc has purchased a new car for $15,000. He paid $2,500 as down payment and he paid the balance by a loan from his hometown bank. The loan is to be paid on a monthly basis for two years charging 12 percent interest. How much are the monthly payments? How much interest will he pay in his first monthly payment?
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