1. Ima Saver has $19702 in cash. She plans to but a new car in five...

1. Ima Saver has $19702 in cash. She plans to but a new car in five years. Ima is highly certain that the car will cost $25702. Ima is shopping around for a bank at which to save for the next five years. What nominal annual interest rate must the bank offer for Ima to be able to afford the car, assuming that she deposits her cash today in the account?

Assume annual compounding. Also assume that the bank accounts are federally insured so that there is no risk of loss.

Express your answer in percent, and round your answer to three decimal places. Do not type the % symbol.

2. Suppose that you own a local auto dealership, Carmen and Rodrigo’s Sales (CARS). Your dealership will finance a new car purchase at an APR of 14%, compounded monthly. The terms of the financing are monthly payments of $432 for five years. The first payment is due one month after the buyer purchases the vehicle.

How much of the purchase price would the buyer be financing with the loan from your dealership?

Do not round at intermediate steps in your calculation. Round your answer to the nearest dollar. Do not type the $ symbol or a minus sign.

Expert Solution

SEE THE IMAGE. ANY DOUBTS, FEEL FREE TO ASK. THUMBS UP PLEASE

As nothing was mentioned excel is used. If you need with formula, let me know, will do that also. Thank you.

jeff jeffy answered 8 months ago

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