Car Loans
Living on Your Own -- Let's Calculate the Cost!


1) Use Yahoo Autosmart (http://autos.yahoo.com/) and choose three cars to research:

For all three cars, assume you will take out a three-year loan. Find the information to fill in the table below.

Use the following information to help you.

Interest rate = 7%
Loan term (time) = 3 years (36 months)

P= principal (price of car)
R= interest rate
T= time


3 Year Loan Car Model Price(P) Interest (I) (I=PRT) -- Use time in years Loan Total (LT) (LT=P+I) Monthly Payment (LT/time in months)
Car A          
Car B          
Car C          



2) Now repeat #1, using 4 years as the loan term.

4 Year Loan Car model Price (P) Interest (I=PRT) Loan Total (LT=P+I) Monthly Payment (LT/time)
Car A          
Car B          
Car C          


3) Now repeat #1, using 5 years as the loan term.

5 Year Loan Car Model Price(P) Interest (I=PRT) Loan Total (LT=P+I) Monthly Payment (LT/time)
Car A          
Car B          
Car C          
*Please note: All car owners are also responsible for paying for gasoline, car maintenance, and auto insurance.

4) Using your three information tables, answer the following questions:

What is the monthly payment for car A for 3 years? 4 years? 5 years?





What is the difference in the Loan Total for car A and car B for 3 years?





For car B, what is the difference in the Loan Total for a 3-year loan and a 5-year loan?





What is the difference in Interest for car C for a 3-year loan and a 5-year loan?





What is the advantage of a 3-year loan compared to a 5-year loan? What is the disadvantage?





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