Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. finance
  3. challenge question i.michael is shopping for a spe

Challenge question I.Michael is shopping for a special automobile. He finds the exact car he​ wants, a...

50.1K

Verified Solution

Question

Finance

Challenge question

I.Michael is shopping for a special automobile. He finds theexact car he​ wants, a 1966 dark blue Pontiac GTO. This car iscurrently the property of a​ neighbor, so to buy it for the​agreed-upon price of 45,000​, Michael must secure his ownfinancing. He visits four different financial institutions and getsthe following available​ loans:

Bank​ 1: 3636 monthly payments of $1,399.78

Bank​ 2: 6060 monthly payments of $891.05

Bank​ 3: 312312 weekly payments of $177.97 ​(Assume a​ 52-weekyear.)

Bank​ 4: 1616 quarterly payments of $3,297.87

Which loan should Michael​ take?  ​Hint:  Which loan has thelowest​ EAR?

If Michael selects Bank 1 for the​ loan, what is the periodicinterest rate on the​ loan?

. 6250​%

If Michael selects Bank 1 for the​ loan, what is the EAR on the​loan?

  ​(Round to two decimal​ places.)

Answer & Explanation Solved by verified expert
4.1 Ratings (667 Votes)
SEE THE IMAGE ANY    See Answer
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Zin AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students

Q

Given FA Prove EA Step L FB FA 1 DB and FBI AC EB Statement...

Geometry
Q

we have encountered several firms that have either failed or came close to collapsing during the...

Finance
Q

1. Determine each of the following set of vectors is linearly independent or dependent. (a) S1 =...

Advance Math
Q

Whos is Rosalind Franklin? Where did she study and what was the time period she worked?...

Biology
Q

O4 in O 8 in O 2 in O not enough info 2 Find y...

Geometry
Q

promotions Price Promotions Amount versus Percentage Uff are commonly used by retailers to motivate consumers...

Basic Math
Q

Again the following graph shows the supply of and demand for Sam s athletic services...

Basic Math
Q

C Use comparative or superlative form of the adjectives A a daki c mleleri s...

Statistics
Q

Pharmacy inventory value stream map: What changes can be made to this current value stream...

Accounting
Q

Problem 11-2A (Algo) Cash dividends, treasury stock, and statement of retained earnings LO C3, P2,...

Accounting
Q

The British pound trades at $1.1248 in London and $1.1241 in New York. How much...

Finance
Q

(b) List six steps which auditors should take to minimize the danger of claims against...

Accounting