QUESTION 13:
You have $240 on hand. However, the credit manager is willing to extend you up to $30,000 of credit. Can you buy the $25,000 Miata?
You have $34,951 in cash. Can you buy the $25,000 Miata?
Yes. You have enough money for the car. (We won't ask about where all that money came from.)
Recall the problem:
You would like to buy a new $25,000 red Miata sports car. To buy the car you could pay cash for it, or you could buy it on credit.
Sometimes individuals have less than $25,000 on hand. No problem—they can always use credit, if they qualify.
You have $240 on hand. However, the credit manager is willing to extend you up to $30,000 of credit. Can you buy the $25,000 Miata?