You have decided to buy a car with price tag of $30,000 but you are able to negotiate the price down to $28,000. You have $1,000 saved, so you need to borrow $27,000 in a 5-year loan from your bank (your bank offers lower rates than the auto-dealer) at a 3% APR (annual rate). How much will you owe to the bank after 2 years?

You have decided to buy a car with price tag of $30,000 but you are able to negotiate the price down to $28,000. You have $1,000 saved, so you need to borrow $27,000 in a 5-year loan from your bank (your bank offers lower rates than the auto-dealer) at a 3% APR (annual rate). How much will you owe to the bank after 2 years?

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter5: The Time Value Of Money

Section: Chapter Questions

Problem 15P

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