A new car dealer advertises financing at 0% interest over 4 years with monthly payments or a $3000 rebate if you pay cash.
(a) The car you like costs $12,000. What effective annual interest rate would you be paying if you financed with the dealer?
(b) The car you like costs $18,000. What effective annual interest rate would you be paying if you financed with the dealer?
(c) The car you like costs $24,000. What effective annual interest rate would you be paying if you financed with the dealer?