Question

This Question: 1 pt 3 of 10 This Quiz: 10 pts possible Estimating Cash Flows Jason's car was just stolen, and the police informed him that theywill probably be unable ko recover it. His insurance will rot cover the thet Jason has a net worth of $5,000, al of shich is easly ocomvertible to cash Jason requires a car for his job and his daily ife. Based on Jamor's cash fow, he cant cumenty afford more han $210 in car paymerts. What optione does he have? How wil these cotions afect his net worh and cash fow What options does he have and how will these options affect his net worth and cash fow? Select the best answer below.)

Answer 1

Option A:

He can convert his networth to cash - In this case, he can use his networth to purchase the car. By using networth to buy a car he can avoid loan and any effect on his cash flow.

Option B:

Borrow the amount - By borrowing the amount needed to buy the car but which will reduce his networth and cash flow.