You are considering buying a new car worth $25,000 today. The dealership will allow you to pick the car today and pay nothing until after you graduate in four years. After four years, you will make a lumpsum payment. You have two financing options. 1) let the dealership finance it for you or 2) finance it yourself though your investment at a local credit union that earns 8% per year. If you do a dealer financing, you will finance the loan for 4 years at 6% per year compounded monthly. If you choose this option, the dealer will throw in a 10% discount and hence you will only take a loan of 90% of the value of the car. You will do a onetime lumpsum payment to the dealer after 4 years. If you finance it yourself, you will pay additional $4,000 to the original value of the car at the time of payment. This means you will end up paying $29,000 to the dealership if you do not finance with them. You currently have a balance of $21,050 in your investment account at the credit union. Which option will you take

answer; ///after donning a gown, mask and eyewear;

true basically. have an awesome day ya'll.

of the three mortgage options that demarco and tanya have to choose from, the balloon payment mortgage would be their best option, over adjustable payment and fixed payment plans.ultimately, the balloon payment plan would save demarco and tanya overall, in interest, would cost less monthly, and they would only have to make these payments for 8 years, opposing to 30 years for adjustable or fixed payment plans. 

overall, demarco and tanya would save $80,811 if they chose balloon payments over fixed payments, and would save $116,711 if they choose balloon payments over adjustable payments. benefits with choosing fixed payments over adjustable payments is that, in the end, the payments will still be $836.30 a month, while with adjustable payments, the initial monthly payments will be $763.38 to $1082.70 a month, ultimately leading to a more costly purchase. benefits with choosing fixed payments over balloon payments are not present. benefits in choosing adjustable payments over is that it has a lower interest rate, and starts with lower monthly payments initially. benefits in choosing adjustable payments over balloon payments include a lower interest rate, and lower initial monthly payments. benefits in choosing balloon payments over fixed payments include lower interest rates, lower overall price, lower monthly payments, takes less time to pay off, and does not require a downpayment. benefits in choosing balloon payments over adjustable payments include, lower monthly payments (when averaged), takes less time to pay off, and lower overall price.

hence, option c, balloon payments, is the best option for demarco and tanya to make this purchase, for it will save them a minimum of $80811, and a maximum of $116,711.