You are looking to buy a new vehicle and found a used Toyota Corolla for $19,000....

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You are looking to buy a new vehicle and found a used Toyota Corolla for $19,000....

You are looking to buy a new vehicle and found a used Toyota Corolla for $19,000. You have $5,000 to put down and are looking to make payments on the rest.You received the following quote (assumetaxes, licensing, etc. are paid separately).

Bank of America will give you a car loan at 7.5% over a 4 year term for $336.40 per month.

1. what is the total cost of the loan?

2.what is the total cost of the car?

3.what is the total amount of interest paid?

business accounting

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Answer 1

Answer #1

1)
Rate = 7.5%/12	0.63%
Period = 4 x 12	48
PMT	336.4
Total Cost of Loan = FV(.63%,48,-336.4)	$18,763.00

2)
Total cost of Car = $5000 (down payment )+ $18763 (cost of loan)	$23,763.00

3)
Total amount of Interest = $18763 (Total cost of Loan) - ( $19000 - $5000) Amt. Borrowed	$4,763.00

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Answer 2

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