You Have Reviewed Your Budget and Determine That the Most

question 116

Multiple Choice

You have reviewed your budget and determine that the most you can afford on a car loan is $550 per month. What is the most you can borrow if interest rates are 6 percent and you can pay the loan over three years?

• A) $1,470.16
• B) $15,639.28
• C) $17,641.92
• D) $18,079.06

---

Definitions:

Cash Dividend

A distribution of a portion of a company's earnings, decided by the board of directors, to a class of its shareholders in the form of cash.

Retained Earnings

The portion of a company's profits kept in the business after dividends are paid, used for investment or debt repayment.

Financing Activities

Activities reported in the statement of cash flows that illustrate changes in the size and composition of the equity and borrowings of a company.

Bonds Issued

Long-term debt securities issued by corporations or governments to raise funds, promising to pay back with interest.