Use your financial calculator to compute the monthly payment and the total amount spent for a vehicle that costs ?$20,000 if you finance the entire purchase over 5 years at an annual rate of 6.00 percent. Also calculate the payment if you finance the car for only four years.? Finally, calculate the payment for three years. What do you notice about the payment under the different time? assumptions?
The monthly? payment, PMT?, on the? 5-year auto loan is? ?(Round to the nearest? cent.)
The total amount spent if you financed ?$20,000 for 5 years at 6.00 percent per year is ?? ?(Round to the nearest? cent.)
The monthly? payment, PMT?, on the? 4-year auto loan is ? ?(Round to the nearest? cent.)
Finally, the monthly? payment, PMT?, on the? 3-year auto loan is? ?(Round to the nearest? cent.)
What do you notice about the payment under the different time? assumptions? ?(Select the best choice? below.)
A. As the number of payments? decreases, the monthly payment? decreases, all else equal. The shorter the borrowing? period, the lower the monthly payments.
B. As the number of payments? decreases, the monthly payment? increases, all else equal. The shorter the borrowing? period, the higher the monthly payments.