Travis can afford a $260-per-month car payment, and he is interested in either a compact car, which costs $10800, or a coupe, which costs 11,300. if he is being offered a 4-year car loan with and apr of 6%, compounded monthly, which car can travis afford?

travis can afford the compact car but not the coupe

Step-by-step explanation:

Travis can afford the compact car.

Step-by-step explanation:

The EMI formula is :

In first case:

p = 10800

r = 6/12/100=0.005

n = 4*12 = 48

Putting values in the formula we get:

= $254

We can see that Travis can afford the compact car because the EMI is less than $260.

In second case:

p = 11300

r = 6/12/100=0.005

n = 4*12 = 48

Putting values in the formula we get:

= $265.75

We can see that the coupe will have an EMI of $265.75 which is higher than the amount that Travis can afford.

Hence, Travis can afford a compact car.