Question

Suppose you are able to negotiate a selling price of 95% of the MSRP. Write the selling price into the Selling Price line of the contract. You may carry this value down to the Price After Equipment Change line. 4. Assume you have no trade-in. Write your selling price in the Taxable Total line of the contract. 5. [0.5 pt] Calculate the sales tax and write this amount in the Sales Tax line of the contract. In the state of Arizona, the tax rate is different depending on where you purchase your car. Currently the Arizona sales tax rate is 5.6%. Maricopa County adds on 0.7% sales tax to support roads and jails. Phoenix has a city tax of 2.3%. That's a total of 8.6% if you purchase your car in the city of Phoenix. Assume we’re buying the car in the city of Phoenix, so use the 8.6% sales tax rate. Work* 0.25 Answer 0.25 Work* 0.25 Answer 0.25 *Work showing how you arrived at the correct answer. Finance Written Problem Set 3 6. [1 pt] The license fee is 2.8% of the value of your car. The value of your car is 60% of the MSRP (not the purchase price!). Write the license fee in the License Fee line of the contract. Ex: If the MSRP is $25,000, the value of your car would be: $25,000 × 0.60 = $15,000 Use this value to calculate the license fee. This value is NOT your license fee. 7. Add the title service fee, license fee, sales tax, and purchase price to obtain the total due. Write this amount in the Total Due line of the contract. 8. [1 pt] You plan to make a 10% down payment. Write your down payment in the Total Cash Down box. 9. Calculate the balance due and write this value in the Balance Due line of the contract. Now we will move on to the financing. Financing: Write the financing information under the FEDERAL TRUTH-IN-LENDING DISCLOSURES part of the contract. 10. Indicate the amount borrowed (balance due) in the Amount Financed box. 11. Assume you can secure a loan at 3.9% for 36 months. Write these values in the Annual Percentage Rate and Number of Payments boxes. 12. [5 pts] Calculate your monthly payment and write this value in the Amount of Payments box. 13. [2 pts] Find the total amount of interest paid during the loan and write the appropriate information in the Total of Payments and Total Finance Charge boxes. Work* 0.5 Answer 0.5 Work* 0.5 Answer 0.5 Formula 1 Work* 2 A