Jamie Lee is considering a used vehicle, but cannot decide where to begin her search. Using...

Jamie Lee is considering a used vehicle, but cannot decide where to begin her search. Using Your Personal Financial Plan Sheets #19, name the sources available to Jamie Lee for a used car purchase.

What are the advantages and disadvantages of each? To keep things consistent, let's use the following:

New Car Dealer
Used-Carl Dealer
Private-Party Sale (through individuals)
Auctions
Used-Car Superstores

Solutions

Expert Solution

New Car Dealer

Advantages

will provide the latest available cars
may provide old stock car (unused) at a lower rate

Disadvantages

Expensive source - As he will be selling unused cars
Probability of availability of Old car is low

Used Car Dealer

Advantages

Deals in Used car, hence car will be easily available.
May provide Installment payments on the purchase of old car from him.
After sale free services are also offered by Dealers.

Disadvantages

The dealer may charge more than reasonable amount.
he may hide the defects of the car by some modifications, as it is his business to sell the used cars.
he may not provide the true details of the car to the customer.

Private - Party Sales (through Individuals)

Advantages

There is a one to one contract between the previous owner and the buyer
Negotiation is possible
The previous owner describes the true condition of his vehicle
chances of deception are low

Disadvantages

It is possible that the individual selling the car may be hiding some facts about the defects in the car.
He may be not traceable after the sale took place.
He may deny the defects detected after the sale took place.

Auctions

Advantages

Rarely found cars may be available through Auctions
Cars put on auctions are properly checked , thus trustable

Disadvantages

Auctions involve bidding which increases the price of cars
Commission and other such related expenses will be incurred, thus a costly source of purchasing a Car.

Used - Car Superstores

Advantages

vast choices available for the buyer.
after sale services offered
many offers are also offered to attract customers

Disadvantages

Car may not be defect free
Price charged will be more than the true value of the car

jeff jeffy answered 6 months ago

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