Let’s assume that the old clunker you have been driving needs $500 in repairs in order to pass an annual car inspection. you are considering buying a new car, and you contact car dealers and banks to determine the best deal you can get on a car loan. assume two different scenarios: (a) the lowest interest rate you find on a five-year car loan is 10 percent, and the annual rate of inflation for the next five years will be
9 percent. (b) the lowest interest rate you can find on a five-year car loan is 6 percent, and the annual rate of inflation for the next five years will be 1 percent.

question: underwhich scenario—(a) or (b)—will you pay less, in real income, for your car loan?

Let’s assume that the old clunker you have been driving needs $500 in repairs in order to pass an annual car inspection. You are considering buying a new car, and you contact car dealers and banks to determine the best deal you can get on a car loan. Assume two different scenarios:

Underwhich scenario—(a) or (b)—will you pay less, in real income, for your car loan?

The lowest interest rate you can find on a five-year car loan is 6 percent, and the annual rate of inflation for the next five years will be 1 percent.

Explanation:

Both year of repayment stands for five years at 10% and 6%, which means the interest of 6% will be acceptable as the inflation in the next five years will be 1% unlike the other one with 9% inflation rate in five years

hi : ) i found this so i hope this !

"we first find value of tax in dollars.

the difference between the two prices   is: 23. 54 - 22 = 1.54

therefore the sales tax in dollars is 1.54

the tax % will be   (amount of tax / original cost price ) × 100

(1.54 / 22) × 100  → (0.07) × 100 =   7

so the tax rate is 7%

we can double check the answer.

7 % of 22   → (7/100) × 22 → 0.07 × 22 = 1.54

22 + 1.54 = 23.54"

answer; read and consider the content of the items;