1. Benefits and Costs
b. Explain the Difference in Cost between Cash and Credit Purchases (continued)
José is buying many things on credit—his education, clothes, a car, a house, he knows what the basic price is for each purchase. But, he wonders what these purchases are really costing him over the period of each loan. So he created this table:
Directions: Answer the following questions about Jose's spending table with the answer(s) that are most correct.
| 1. How much more does Jose pay for closthes if he pays with a credit card rather than cash? |
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| 2. How much more does he pay for a car if he pays with a loan rather than with cash |
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| 3. How much more does Jose pay for closthes if he pays with a credit card rather than cash? |
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| 4. Comparing the 7.5% vs. the 8.5% loan over 30 years, how much would he save over the entire period of the loan? |
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| 5. If he stretches his finances and takes a 15-year loan at 7% rather than a 7.5% loan for 30 years, which is true? |
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| 6. If he needs to keep his monthly mortgage payments as low as possible, which loan should he choose? |
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| 7. If he wishes to keep the total cost of his house at the lowest level, which loan should he choose |
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