1)Todd can afford to pay $390 per month for the next 7 years in order to...

1)Todd can afford to pay $390 per month for the next 7 years in order to purchase a new car. The interest rate is 6.8 percent compounded monthly. What is the most he can afford to pay for a new car today?

2)Bob has been investing $7,500 in stock at the end of every year for the past 8 years. If the account is currently worth $93,400, what was his annual return on this investment?

3)You plan to save $390 per month starting today for the next 48 years "just to start the month off right." You feel that you can earn an interest rate of 9.5 percent compounded monthly. How much will there be in the account 48 years from today?

Expert Solution

jeff jeffy answered 2 years ago

Todd is able to pay $220 a month for five years for a car. If the interest rate is 3.9 percent, how much can Todd afford to borrow to buy a car?

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