Time value Personal Finance ProblemAs part of your financial planning, you wish to purchase a new car

8

years from today. The car you wish to purchase costs

$13,000

today, and your research indicates that its price will increase by

3%

to

6%

per year over the next

8

years.a.Estimate the price of the car at the end of

8

years if inflation is (1)

3%

per year and (2)

6%

per year.b.How much more expensive will the car be if the rate of inflation is

6%

rather than

3%?

c.Estimate the price of the car if inflation is

3%

for the next

3

years and

6%

for

5

years after that.

a. The price of the car at the end of

8

years, if inflation is

3%

per year, is

$nothing.

(Round to the nearest cent.)The price of the car at the end of

8

years, if inflation is

6%

per year, is

$nothing.

(Round to the nearest cent.)b. At the higher rate of inflation, the car is more expensive by

$nothing.

(Round to the nearest cent.)c.The price of the car at the end of

8

years, if inflation is

3%

for the next

3

years and

6%

for

5

years after that, is

$nothing.

(Round to the nearest cent.)