You Want to Purchase a Boat That Costs $40,000

Multiple Choice

You want to purchase a boat that costs $40,000. You want to finance as much of the purchase as possible with a 5-year bank loan at 12% compounded monthly, but can only afford loan payments of $750 per month. How much will you need as a down payment to buy the boat? (Round to the nearest dollar)

A) $3,523
B) $4,637
C) $5,147
D) $6,284