Question: you want to buy a new jeep that cost 24000...
You want to buy a new jeep that cost $24,000. You intend to pay
$2400 down payment and finance $21,600.
You are given two options. Option 1: finance through the local bank at 2.99% per year for 48 months,
compounded monthly. Option 2: finance through a credit union at 3.99% per year for 48 months and is a simple
interest loan. Which loan has the greater future value (greater cost to you)?
ANSWER: Option 1: F = $24,340.57, Option 2: F = $25,047.36