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Urgent... QUESTION 2 & 3 & 4 of Integrative Case of Corporate Finance (Adam Rust looked at his mechanic and sighed..........) Kindly equip me with
Urgent... QUESTION 2 & 3 & 4 of Integrative Case of Corporate Finance (Adam Rust looked at his mechanic and sighed..........)
Kindly equip me with answers please, especially QUESTION 2 & 3 & 4, thank you extremely much
PART Integrative Case This case draus on material from Chapters 3-7. Adam Rust looked at his mechanic and sighed. The mechanic had just pronounced a death sentence on his road-weary car. The car had served him well-at a cost of $500 it had laste through four years of college with minimal repairs. Now, he desperately needs wheels. He has just graduated, and has a good job at a decent starting salary. He hopes to purchae his first new car. The car dealer seems very optimistic about his ability to afford the a payments, another first for him The car Adam is considering is $35,000. The dealer has given him three payment options: 1. Zero percent financing. Make a $4000 down payment from his savings and finan noug the remainder with a 0% APR loan for 48 months. Adam has more than e cash for the down payment, thanks to generous graduation gifts. 2. Rebate with no money doun. Receive a $4000 rebate, which he would use for down payment (and leave his savings intact), and finance the rest with a standar 48-month loan, with an 8% APR. He likes this option, as he could think of many other uses for the $4000 3. Pay cash. Get the $4000 rebate and pay the rest with cash. While Adam doesn have $35,000, he wants to evaluate this option. His parents always paid cash win they bought a family car; Adam wonders if this really was a good idea. for Adam's fellow graduate, Jenna Hawthorne, was lucky. Her parents gave her a car graduation. Okay, it was a little Hyundai, and definitely not her dream car, but it was viceable, and Jenna didn't have to worry about buying a new car. In fact, Jenna has trying to decide how much of her new salary she could save. Adam knows that witha h car payment, saving for retirement would be very low on his priority list. Jenna believes could easily set aside $3000 of her $45,000 salary. She is considering putting her a stock fund. She just turned 22 and has a long way to go until retirement at er savings 65, a nsiders this risk level reasonable. The fund sh e is looking at has earned an aver t. of 9% over the past 15 years and could be expected to continue earning this amour et average. While she has no current retirement savings, five years ago Jenna's gra gave her a new 30-year U.S. Treasury bond with a $10,000 face value dparents Jenna wants to know her retirement income if she both (1) sells her Treasury its current market value and invests the proceeds in the stock fund and (2) saves an tional $3000 at the end of each year in the stock fund from now until she turns she retires, Jenna wants those savings to last for 25 years until she is 90. 65. Both Adam and Jenna need to determine their best optionsStep by Step Solution
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