Question
You can buy a car that is advertised for $16,560 on the following terms: (a) pay $16,560 and receive a $2,560 rebate from the manufacturer;
You can buy a car that is advertised for $16,560 on the following terms: (a) pay $16,560 and receive a $2,560 rebate from the manufacturer; (b) pay $460 a month for 3 years for total payments of $16,560, implying zero percent financing.
| a. | Calculate the present value of the payments for option (a), if the interest rate is .75% per month.
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Analysis For Financial Management
Authors: Robert Higgins
6th Edition
0071181172, 9780071181174
