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 link below used for the cover letter assignment

Effects of a Down Payment

Question: You are shopping for a car at a local car dealership. You find a car you want and are considering whether or not you should pay a down payment as part of your financing agreement with the dealership. Here are the specifics of the situation you are in:

1. Your car costs $10,000. This does not include sales tax (7%), or the cost for the title to be put in your name and to get a new license plate ($400 total).

2. You will have to pay back everything you owe the dealership in 6 years.

3. They will charge you 12% interest on the amount financed.

4. You could potentially put down $2000 for a down payment, if you had to.

How much cheaper would your monthly payments be if you did put down a $2000 down payment compared to your monthly payments if you didn’t put down that down payment?

Step 1: Identify Relevant Information.

What are the relevant pieces of information in this problem?

Step 2: Choose a Mathematical Model. 

What mathematical formula will you need to solve this problem?

Step 3: Express Information in Mathematical Forms. 

What data were you provided in the problem? Represent this data using variables and show how you would utilize this data in the mathematical formula from step 2.

Step 4: Develop a Viable Plan.

What is your plan to solve this problem and what data and/or calculations do you need to back up your solution?

Step 5: Execute a Solution Plan.

Determine a solution by performing the necessary calculations. Make sure to include any supporting work.

Step 6: Draw a Well-Supported Conclusion.Bottom of Form

What is your conclusion? Make sure to support your statement with calculations, data etc.

 

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