The Johnsons Decide to Buy a Car After several years of riding a bus to work, Belinda finds that she can no longer do so because her employer moved to a location that is not convenient for public transportation. Thus the Johnsons are in the market for another car. Harry and Belinda estimate that they could afford to spend about $$12,000$ on a good used car by making a down payment of $$2,000$ and financing the re$-$ mainder over $36$ months at a $6$ percent interest rate for

$$304$ per month.

$($a$)$ Make suggestions about how the $$304$ might be integrated into the Johnsons' budget $($Table $3-6$ on page $97)$ by making reductions in certain expense

categories.

$($b$)$ If they cannot make room in their budget for a $$304$ monthly car payment, would you recommend they finance a vehicle for $48$ or $60$ months? Why or

why not:

$($c$)$ Assume that the Johnsons have narrowed their choices to two cars. The first car is a three$-$year$-$old Chevrolet with $44,000$ miles; it is being sold for $$12,500$ by a private individual. The seller has kept records of all maintenance and repairs. The second car is a three$-$year$-$old Toyota with $51,000$ miles, being sold by a used$-$car dealership. Harry contacted the previous owner and found that the car was given in trade on another car about three months ago. The previous owner cited no major mechanical problems but simply wanted a bigger car. The dealer is offering a written $30-$day warranty on parts only. The asking price is $$12,200.$ Which used car would you advise

the Johnsons to buy? Why?

$($d$)$ Would you recommend that they purchase or lease a low$-$priced new vehicle instead of buying a used

vehicle? Why or why not?

Submit your answers to items A thru D along with calculations supporting your decisions