1. You are considering buying a home entertainment system. You have two appealing offers both at a 6% simple interest rate.
   1. The first offers you a price of $8000 with a simple interest 36 month installment loan if you pay a downpayment of 1000. Your monthly payments would be $212.94 per month
   2. The second offers you the same system at a price of $8000 and no down payment with a simple interest 48 month loan at 6%. The monthly payment would be $187.92 per month.

Using total transaction costs, compare the costs of the two offers. Which would you choose?