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You just bought a new luxury sports car for $131,000. Before you had time to get insurance, the car was wrecked. Weird Wally offers to
You just bought a new luxury sports car for $131,000. Before you had time to get insurance, the car was wrecked. Weird Wally offers to take it off your hands for $10,000. You can then purchase a similar model for $130,000. A body-shop (with an excellent reputation) offers to rebuild the wrecked car for $93,000 and loan you a similar model while the vehicle is being rebuilt. Once rebuilt, the body-shop claims, it will "run like a new car and nobody will be able to tell the difference." What is the preferred course of action, from a financial point of view?
A) Rebuild to save $12,000
B) Rebuild to save $27,000
C) Rebuild to save $37,000
D) Sell to Weird Wally and save $6,000.
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