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Suppose you intend to purchase a new car after you graduate. You expect to put $5,000 down and finance the balance over a 5-year period.

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Suppose you intend to purchase a new car after you graduate. You expect to put $5,000 down and finance the balance over a 5-year period. The maximum amount you are willing to pay each month is $600. What is the maximum price you can pay for the car in other words, how much you can afford to pay for the car, assuming an interest rate of 8% per year, compounded monthly

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