Bella Wans is interested in buying a new motorcycle. She has decided to borrow the money...

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Bella Wans is interested in buying a new motorcycle. She hasdecided to borrow the money to pay the $30,000 purchase price ofthe bike. She is in the 33?% income tax bracket. She can eitherborrow the money at an interest rate of 5?% from the motorcycle?dealer, or she could take out a second mortgage on her home. Thatmortgage would come with an interest rate of 8?%. Interest paymentson the mortgage would be tax deductible for? Bella, but interestpayments on the loan from the motorcycle dealer could not bededucted on? Bella's federal tax return.
a.??Calculate the ?after-tax cost of borrowing from themotorcycle dealership.
b. Calculate the ?after-tax cost of borrowing through a secondmortgage on? Bella's home.
c.??Which source of borrowing is less costly for? Bella?
d.??Should Bella consider any other factors when deciding whichloan to take? out?

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Bella Wans is interested in buying a new motorcycle. She hasdecided to borrow the money to pay the $30,000 purchase price ofthe bike. She is in the 33?% income tax bracket. She can eitherborrow the money at an interest rate of 5?% from the motorcycle?dealer, or she could take out a second mortgage on her home. Thatmortgage would come with an interest rate of 8?%. Interest paymentson the mortgage would be tax deductible for? Bella, but interestpayments on the loan from the motorcycle dealer could not bededucted on? Bella's federal tax return.a.??Calculate the ?after-tax cost of borrowing from themotorcycle dealership.b. Calculate the ?after-tax cost of borrowing through a secondmortgage on? Bella's home.c.??Which source of borrowing is less costly for? Bella?d.??Should Bella consider any other factors when deciding whichloan to take? out?