Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

the qustion is long so it' seprate in two photo ( please solve it as excel) + The formed plecamy head me the one which

image text in transcribed
the qustion is long so it' seprate in two photo ( please solve it as excel) image text in transcribed
image text in transcribed
+ The formed plecamy head me the one which www.hr ESC Join a global community of cardiologists Become an ESC Professional Member LEARN MORE Fin Cali Peyma ddedd y plan G H Month Cash payment Payment under deferred payment plan Difference 2 25. 105.4 4 3 0 0 0 0 7 1.00 10 -106 1050 -1050 1050 1.050 2 10 11 0 01 01 1050 -10581 New 9 You are considering buying a car from a local auto dealer. The dealer offers you one of two payment options: You can pay $30,000 cash. The "deferred payment plan": You can pay the dealer $5.000 cash today and a payment of $1.050 at the end of each of the next 30 months. As an alternative to the dealer financing, you have approached a local bank, which is willing to give you a car loan of $25,000 at the rate of 1.25% per month 49 Basic Financial Calculations a. Assuming that 1.25% is the opportunity cost, calculate the present value of all the payments on the dealer's deferred payment plan. 5. What is the effective interest rate being charged by the dealer? Do this calculation by preparing a spreadsheet like this (only part of the spreadsheet is shows--you have to do this calculation for all 30 months) D E a. Assuming that 1.25% is the opportunity cost, calculate the present value of all the payments on the dealer's deferred payment plan. b. What is the effective interest rate being charged by the dealer? Do this calculation by preparing a spreadsheet like this only part of the spreadsheet is shown-you have to do this calculation for all 30 months): D E F H Month 2 3 4 5 6 7 8 OPINIO Payment under Cash payment deferred Difference payment plan 30,000 5,000 25,000.- =E3-F3 0 1,050-1,050

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Continuous Time Finance

Authors: Robert C. Merton

1st Edition

0631185089, 978-0631185086

More Books

Students also viewed these Finance questions

Question

How do you identify yourself culturally?

Answered: 1 week ago