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Harry is looking at a double cab truck which has an MSRP of $54,999. The dealer...

Harry is looking at a double cab truck which has an MSRP of $54,999. The dealer will finance the truck at 1.91% interest for 60 months. Harry thinks he can afford monthly payments of $911.00 per month. Can Harry afford the truck? Why?

Yes; he can afford a loan amount of exactly $54,999.

Yes; he can afford a loan amount of $55,834.

No; he can afford a loan amount of $54,660.

No; he can afford a loan amount of $52,092.

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Answer #1

Maximum loan amount = pv = = PMT(1-(1/(1+r^n)))/ $32,368.64 911*(1-(1/(1.0191460))/0.0191 No; he can afford a loan amount of

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