"Zero percent financing" means the obvious thing$$that no interest is being charged on the loan. So if we borrow $$1200$ at $0\%$ interest and pay it off over $12$ months, our monthly payment will be $$1200/12=$ $$100.$

Suppose you are buying a new truck at a price of $$10,000.$ You plan to finance your purchase with a loan you will repay over two years. The dealer offers two options: either dealer financing with $0\%$ interest, or a $$1000$ rebate on the purchase price. If you take the rebate, you will have to go to the local bank for a loan $($of $$9,000)$ at an APR of $6\mathrm{.}5\%.$

What would your monthly payment be if you took the rebate? $($Round your answer to the nearest cent.$)$

$

What would your monthly payment be if you used dealer financing? $($Round your answer to the nearest cent.$)$

$

Should you take the dealer financing or the rebate? $($Assume you take the deal that saves you the most money.$)$

dealer financing

rebate

How much would you save over the life of the loan by taking the option you chose? $($Round your answer to the nearest cent.$)$

$