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You can choose either a $2000 cash discount or a low 2.8% financing rate to buy a care which is valued at $20,000. If you took the cash discount, you will finance the remaining amount at a rate of 4%. If you took the low financing rate option, you will not get any cash discount. Loan is over a 4 year period. Payments are made monthly. Interest is compounded monthly. Which of the two choices would you select? Please show your calcuation.

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Financial Management, Finance

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