Answered

3.

You (or your parents) are debating about whether to buy a new car for $19,072.00 or a used car for $15,635.00. Sales tax is 4.5%. You (or your parents) plan to make a down payment of $1,200.00 and your credit rating is fair. Use the table below to determine the difference in interest accrued by the end of the first month.
Secured Unsecured
Credit APR (%) APR (%)
Excellent 4.80 5.25
Good 5.15 5.65
Average 5.85 6.20
Fair 7.00 7.65
Poor 8.20 9.15



$18.02

$16.55

$20.95

$21.63

Answer :

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Answer:

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Step-by-step explanation:

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Answer:

$20.95

Step-by-step explanation:

Credit rating is fair ⇒ Secured APR = 7.00%

Loan amount = sale price + tax - down payment

new car = 19072 + (19072 x 0.045) - 1200 = 18730.24

used car = 15635 + (15635 x 0.045) - 1200 = 15138.575

Monthly interest = loan amount x 0.07 x 1/12

new car = 18730.24 x 0.07 x 1/12 = 109.26

used car = 15138.575 x 0.07 x 1/12 = 88.31

Difference = 109.26 - 88.31 = $20.95

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