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14. Question Details CraudQL3 4.2.028c. [4116955] When interest rates are low, some automobile dealers offer...

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14. Question Details CraudQL3 4.2.028c. [4116955] When interest rates are low, some automobile dealers offer loans at 0% APR, as indicated in a 2016 advertisement by a prominent car dealership, offering zero percent financing or cash back deals on some models. Zero percent financing means the obvious thing-that no interest is being charged on the loan. So if we borrow $1,200 at 0% interest and pay it off over 12 months, our monthly payment will be $1,200/12 = $100. Suppose you are buying a new truck at a price of $30,000. You plan to finance your purchase with a loan you will repay over two years. The dealer offers two options: either dealer financing with 0% interest, or a $3,000 rebate on the purchase price. If you take the rebate, you will have to go to the local bank for a loan (of $27,000) at an APR of 6.5%. Should you take the dealer financing or the rebate? (Assume you take the deal that saves you the most money.) O dealer financing O rebate How much would you save over the life of the loan by taking the option you chose? (Round your answer to the nearest cent.) $ eBook

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