Assume the same information as in BE3.24, except that you can afford to make annual payments of only $6,000. If you decide to trade in your current car to help reduce the amount of financing required, what trade-in value would you need to negotiate to ensure your annual payment is $6,000? Show
calculations using
(a) Factor Table PV.2,
(b) A financial calculator,
(c) Excel function PV.
Data from BE3.24 You would like to purchase a car with a negotiated price of $30,000, and the offers financing over a five-year period at 8%. If repayments are to be made annually, what would be your annual payments?
