Leslie Has Been Offered the Choice of Either a $1,000

question 64

Essay

Leslie has been offered the choice of either a $1,000 rebate or a 5.5%, 48-month loan for the new car she is purchasing. If Leslie will be financing $15,000 and can get a 7.5%, 48-month loan at her credit union, should she take the $1,000 rebate or the 5.5% loan? (Show all work.)

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Definitions:

Productive Land Resources

Land areas that are utilized or capable of being utilized for agricultural production, mining, or other economic activities.

Purely Competitive Economy

An economic model characterized by many buyers and sellers in the market, with none able to influence prices significantly.

Pure Rent

The income derived from the inherent attributes of a resource or property, exclusive of any improvement made by human effort.

Reproducible Resources

Resources that can be grown, naturally replenished, or reproduced to sustain their availability over time, unlike finite resources.