) You bought your car used 4 years ago for $16,000. It has served you well but seems to be prone to more and more expensive repairs and you are considering replacing it. You have found another used car that meets your needs for $19,000 but you are hesitant to commit to spending that much money again on another used car. You estimate your present car will cost you $1,000 a year in repair costs and $750/year in gas and oil. The new used car you are considering has a better maintenance history and comes with a limited warranty. You think your maintenance costs will only be $500/year for the next ten years and $500/year in gas and oil. Similar cars of the same age (10 years old) can be sold for $5,000. Your present used car seems to be on its last legs, and you think it will only last for another 3 years. It will be pretty much not worth anything other than salvage metal and parts then and only worth $750. The Kelly Bluebook estimate for your car right now is $5,000 but your neighbor offered you $3,500 cash. What do you do? A car loan for someone with the same credit rating as you is 6%.