Financial institutions often offer lower auto loan rates for new cars than used ones. A local credit union advertises new car loans at 2.79% APR and used car loans at
3.29% both for up to 72 months.
Tyresa wants to buy a car but doesn't want to spend more than $350 a month for a
maximum of four years. What is the maximum loan amount she can take out for a
new car and a used car using the advertised rates?
P[(1+" - 1
Use the formula, A
where P is the monthly payment, r is the
annual interest rate, n is the number times interest is compounded in one year, and t
is the number of years. Show all of your steps.