Time value Personal Finance ProblemAs part of your financial planning, you wish to purchase a...
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Time value Personal Finance ProblemAs part of your financial planning, you wish to purchase a new car exactly 8 years from today. The car you wish to purchase costs$18,000today, and your research indicates that its price will increase by 3% to 6%
per year over the next 8years.
a.Estimate the price of the car at the end of 8years if inflation is (1) 3% per year and (2) 6%
per year.
b.How much more expensive will the car be if the rate of inflation is 6% rather than 3%?
c.Estimate the price of the car if inflation is 3% for the next 2years and 6% for 6years after that.
a. The price of the car at the end of 8years, if inflation is 3% per year, is
$
(Round to the nearest cent.)
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