Angel's Garage is paying off a new car lift in three annual installments of $900, with...

Angel's Garage is paying off a new car lift in three annual installments of $900, with an interest rate of 6.5% compounded annually. Payments are made each August.

Explain what Angel's will have paid in total, after all three payments are made. Show all calculations.

Explain what would be different if interest were compounded monthly.

If Angel's Garage gets the opportunity to refinance the payment plan at 6.45% interest which compounds monthly after the first payment but before the second, would you advise Angel to refinance, or not? Explain your answer and show all calculations.

Expert Solution

ekkarill92 answered 1 year ago

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