To Compare the Two APRs Accurately When Choosing Between Low

question 114

True/False

To compare the two APRs accurately when choosing between low interest rate dealer financing and a rebate on a new vehicle,you must subtract the opportunity cost of the foregone rebate from the finance charge of the dealer financing.

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Definitions:

Coupon Rate

The yearly interest rate that a bond yields, represented as a percentage of its nominal value.

Face Value

The nominal or dollar value printed on a bond or stock certificate, representing the amount due at maturity or the value of a share.

Annual Interest

The amount of interest due per period, as a proportion of the amount lent, deposited, or borrowed.

Montreal Bond Market

A marketplace for the trading of bonds issued within or by entities located in Montreal, Canada, or related to its economy.