Billie and Colbie qualify for a 6-year car loan with a 3.8% APR or a...
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Billie and Colbie qualify for a 6-year car loan with a 3.8% APR or a 3-year car loan with an 2.7% APR. They found a dealership certified pre-owned 2019 Nissan Frontier Pro 4x listed at $29,000 with only 13,760 miles on it. Their combined annual income is $72,000. They know they shouldnt pay more than 10% of their monthly income on car payments.
b) Assuming Billie and Colbie will make payments for the entire life of the loan, how much will they pay monthly for each loan option? Are either of these options within 10% of their monthly income? Indicate which formula you use and identify all of the relevant variables (A, P, APR, n, Y, and/or PMT).
c) Assuming Billie and Colbie will make payments for the entire life of the loan, how much will they pay in total for each loan option including the down payment?
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