math
posted by Denise .
Joe is getting ready to buy a car. He has $20,000 in investments earning 4.9% annually. The car also costs $20,000. If he doesnâ€™t pay cash for the car, Joe can get a loan at 2.9% interest for 5 years. The loan is structured so that Joe pays one balloon payment at the end of 5 years. The balloon payment includes the principal plus all interest accrued over 5 years. If Joe takes the loan will he have enough money available from his investments to make the balloon payment? How much will he be short/have to spare?

I = PRT
I = 20,000 * 0.049 * 5
I = $4,900
~~~~~~~~~~~~~~~~~~~~~~~
I = 20,000 * 0.029 * 5
I = ? 
well, you can use the Excel to solve this question. first, you can calculate two FV. then using the result of fv 25404.3123073.15=2331.16 so, he can pay the balloon payment and will spare $2331.16
Respond to this Question
Similar Questions

Physics
I am stuck on a question that asks for the resultant force(magnitude + direction) question says : A rope is strung between a car and Joe, the car pulls on the rope with a force of 20,000 newton. joe pulls the rope with a force of 25,000N. … 
math
Joe has $10,000 to purchase a used car. If the sales tax is 7% and the fee for title and license plates is $200, what is the maximum amount Joe can spend for a car? 
math
Joe has $10,000 to purchase a used car. If the sales tax is 7% and the fee for title and license plates is $200, what is the maximum amount Joe can spend for a car? 
Math
Joe has $10,000 to purchase a used car. If the sales tax is 7% and the fee for title and license plates is $200, what is the maximum amount Joe can spend for a car? 
consumer math
Alisha has a fiveyear car loan of $15,000 with an interest rate of 6 percent. If the interest is compounded annually, how much will she pay in total for her car? 
Finance
After deciding to buy a new car, you can either lease the car or purchase it on a 3year loan. The car costs $32,000. The lease offer is for $450/month for 36 months, with only $99 due up front. If you buy the car with a 3year loan, … 
Finance
You are interested in a new Ford Taurus. After visiting your Ford dealer, doing your research on the best leases available, you have three options. (i) Purchase the car for cash and receive a $1,900 cash rebate from Dealer A. The price … 
Finance
You are interested in a new Ford Taurus. After visiting your Ford dealer, doing your research on the best leases available, you have three options. (i) Purchase the car for cash and receive a $1,900 cash rebate from Dealer A. The price … 
finance
You have only saved 2,000. You are going to trade in your old car and get a new one. The dealership has offered you 3,000 for your trade, and you have accepted their offer. The car you want to buy costs 23,000 but you talked them down … 
finance
You want to purchase a car. It costs 25,000. You have 3,000 that you have saved up for a down payment. You can go with the 5 year car and 60 month car loan. The car manufacture is offering a special deal on your car. You can get zero …