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You are considering purchasing a new car. The price would be $18,239. You would pay $2,000 now as down payment and pay the rest using
You are considering purchasing a new car. The price would be $18,239. You would pay $2,000 now as down payment and pay the rest using a loan on a monthly basis over four years. The automobile dealership is offering loan promotions where either, Plan A - you will receive a $1,000 rebate right now to offset your down payment and the annual interest rate on the loan will be 11.9% or, Plan B - the annual interest rate on the loan will be 7.9% but there is no rebate. a) Create 2 models to compare the two plans by calculating, The monthly payment amount The present value of the total outflow of cash for each plan, assuming an annual 8% discount rate Which is the better deal? . b) At what rebate amount for Plan A will there be no difference between the 2 plans
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