OLD DOMINION DEA FUSION 23. It is estimated that the maintenance cost on a used
ID: 1143261 • Letter: O
Question
OLD DOMINION DEA FUSION 23. It is estimated that the maintenance cost on a used car will be s270 the first year. Each subsequent year, the maintenance cost will increase by $90. At an interest rate of 50% per year, what is the equivalent equal uniform annual cost of maintaining the car for its 6 years ownership? a. $361 b. $392 c. $482 d. $495 4o 45 U ktra Credit: Imagine you have just agreed to buy a 2013 Subaru BRZ from a classmate for $15,000, but you don't have $15,000 and need to finance this purchase with a 60 month loan. Find a competitive interest rate on a used car loan from a bank or credit union. honlo or credit unions You may assume your credit rating isExplanation / Answer
ANSWER: I AM SOLVING QUESTION NO 23 AS FOR OTHER QUESTION IS INCOMPLETE AS IT CANNOT BE SEEN FULLY.
23) maintenance cost = $270
i = 5% per year
increase in cost = $90
n = 6 years
maintenance cost in 1st year = $270
maintenace cost in 2nd year = maintenance cost in 1st year + increase in cost = $270 + $90 = $360
maintenace cost in 3rd year = maintenance cost in 1st year + increase in cost = $360 + $90 = $450
maintenace cost in 4th year = maintenance cost in 1st year + increase in cost = $450 + $90 = $540
maintenace cost in 5th year = maintenance cost in 1st year + increase in cost = $540 + $90 = $630
maintenace cost in 6th year = maintenance cost in 1st year + increase in cost = $630 + $90 = $720
pw = maintenance cost in 1st year(p/f,i,n) + maintenance cost in 2nd year(p/f,i,n) + maintenance cost in 3rd year(p/f,i,n) + maintenance cost in 4th year(p/f,i,n) + maintenance cost in 5th year(p/f,i,n) + maintenance cost in 6th year(p/f,i,n)
pw = 270(p/f,5%,1) + 360(p/f,5%,2) + 450(p/f,5%,3) + 540(p/f,5%,4) + 630(p/f,5%,5) + 720(p/f,5%,6)
pw = 270 * 0.9524 + 360 * 0.907 + 450 * 0.8638 + 540 * 0.8227 + 630 * 0.7835 + 720 * 0.7462
pw = 257.15 + 326.52 + 388.71 + 444.258 + 493.605 + 537.264
pw = $2,447.51
euac = pw(a/p,i,n)
i = 5% and n = 6 years
euac = 2,447.51(a/p,5%,6)
euac = 2,447.51 * 0.197
euac = $482.158
hence option c is the right answer.
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.