Mod 2 and 4

2. Determine the total amount Dean will pay for his car if he finances the purchase. $_____________

Determine the amount of interest Dean will pay the creditor over the life of the loan. $______________

3. Suppose Dean decides to save his money and buy the car later.

If he deposits the monthly payment you previously calculated into an account that pays 1.5% for 5 years.

How much will he have saved?______________

1. Discuss whether Dean should buy the car now or not.   Be sure to write a full paragraph, with at least five substantial sentences.   Be sure to support your explanations with facts.   You should express the disadvantages and advantages of each option.   You should use proper grammar.

5. Most all of us indulge in some way from time to time. Many would agree that doing so occasionally is perfectly fine. However, if we indulge too much, we may find that our budgets are unbalanced. Consider Simon's coffee habit below.

Every Monday through Friday Simon purchases a coffee beverage for $4.72 at the local Sunbucks Coffeehouse on his way to work.He does not visit Sunbucks on the weekends.

How much does he spend each week? $_______

How much would he spend in a year, assuming he goes every week? $_____

6. Instead of going to Sunbucks every day, Simon chooses to get healthy and not purchase the beverages anymore. He takes the amount he would spend per year and divides it into monthly investments.

How much does he invest each month?  Round to the nearest cent. $______

Let’s see how much he would have for retirement, depending on his current age.

Assume he will retire at age 65 and is able to find an investment yielding 1.2%. Fill-in the chart, using the Savings Plan Formula.  Round answers to the nearest dollar.

Simon's Savings