11. If Bonnie financed $10,000 for a new car at a 4% APR, paid back over 5 years, her monthly principal + interest payment would be $184.
a. Assuming she keeps her car and pays it off in 5 years, how much total money will she have paid the lender in 5 years? (Section 8.3) (1 point)
b. How much of the total money paid in part (a) was interest to the bank/lender? (Section 8.3) (1 point)
12. Pat’s credit score is much lower than Bonnie’s because he had two 30 day late payments to the lender on his credit card. The lowest auto loan APR he was able to qualify for was 6% because of his lower credit score. He wants to finance $10,000 for a new car just like Bonnie. Use the online loan calculator at www.bankrate.com/calculators/mortgages/loan‐calculator.aspx to help you determine how much higher the cost of Pat’s auto loan (total interest over 5 years) will be paying 6% instead of the 4% rate Bonnie got. Make sure to clearly show how much more Pat will pay over the life of the loan with the higher interest rate. (Section 8.3)