College Algebra Project (50 test points)



College Algebra Project (50 test points)

1. Using various search engines, research purchasing a vehicle. You may purchase new or used. Get at least 3 quotes on similar cars to find the best deal. (Suggestion: start at or ) Print your 3 car quotes.

2. Research current interest rates for purchasing a vehicle. Get at least 2 rates quotes from various banks (national or local). Make sure the rate quote is for a used car if that is your choice or a new car if that is your choice.

3. Using our interest formula, compute your total car cost and total interest amount using the following scenarios:

a. 3 year loan, compounded daily/continuously

b. 3 year loan, compounded weekly (w/ a 0.25% interest rate increase)

c. 3 year loan, compounded monthly (w/ a 0.25% rate increase)

d. 4 year loan, compounded daily/continuously

e. 4 year loan, compounded monthly (w/ a 0.25% interest rate increase)

f. 4 year loan, compounded monthly (w/ a 0.25% rate increase)

g. 5 year loan, compounded daily/continuously

h. 5 year loan, compounded weekly (w/ a .025% interest rate increase)

i. 5 year loan, compounded monthly (w/ a 0.25% rate increase)

4. Which scenario gives you the lowest total amount due? Why?

5. Take your best “rate deal” for the 3 year loan, 4 year loan, 5 year loan and compute your monthly payment for all 3. (I would suggest you find an online payment calculator b/c computing monthly payment is very complicated.) Which year amount seems like the best deal based on monthly payment? Is it? (justify your answer by computing the total amount spent for the loan)

6. If the dealership offered you either 0% interest or $125 cash back per thousand of your purchase price, which would you take? Compute the monthly payment for each option for a 3, 4, and 5 year loan. Explain why your answer will change based on the time period you chose.

7. Choose either a 3, 4 or 5 year loan based on your conclusions.

8. From the given information, what advice would you give to a friend looking to purchase a new or used car?

9. What changes (if any) would you make to your purchase choice? Can you afford your car choice?

10. Compute your total car cost if the bank were to charge you an additional 5% interest rate. Is this percentage rate significant? Research credit card rates for someone with fair credit and site two specific cards and rates. How much does this differ from car rates? What would your car cost you if you had to pay for it with a credit card?

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