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HoracioMo HoracioMo
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11 months ago
Westwood Homes is beginning work on its future College Park sub-division. Westwood is now pre-selling homes that will be ready for occupancy in nine months. Westwood is offering $5000 off the $295,000 selling price to anyone making an immediate $130,000 down payment (with the balance due in nine months.) The alternative is a $5000 deposit with the $290,000 balance due in nine months. Mr. and Mrs. Symbaluk are trying to decide which option to choose. They currently earn 4.8% on low-risk short-term investments.

a) What is the current economic cost of buying on the $130,000-down $5000-off option?
b) What is the current economic cost of buying on the $5000-deposit full-price option?
c) Which alternative should the Symbaluks choose? In current dollars, what is the economic advantage of the preferred alternative?
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Business Mathematics in Canada

Business Mathematics in Canada


Edition: 11th
Authors:
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frithnefrithne
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11 months ago
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HoracioMo Author
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11 months ago
Smart ... Thanks!
AlahuKakpar
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This calls for a celebration Person Raising Both Hands in Celebration
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2 hours ago
Brilliant ツ
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