You Are Considering Purchasing a New Truck That Will Cost

question 40

Multiple Choice

You are considering purchasing a new truck that will cost you $34,000.The dealer offers you 1.9% APR financing for 48 months (with payments made at the end of the month) .Assuming you finance the entire $34,000 and finance through the dealer,your monthly payments will be closest to:

• A)$708.
• B)$725.
• C)$736.
• D)$1086.

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Definitions:

Forward Exchange Contract

A financial contract between two parties to exchange currencies at a predetermined future date and rate, used to hedge against foreign exchange risk.

Premium

The amount paid for a product or service above its nominal value, often related to insurance or bonds.

Discount

A reduction from the usual cost of something, or the amount by which an asset's book value is reduced for accounting purposes.

Inception Date

The date on which an agreement, contract, or financial instrument becomes effective.