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8-3 HOW DO WE PURCHASE A USED AUTOMOBILE?

8-3 HOW DO WE PURCHASE A USED AUTOMOBILE?. Automobile dealers usually advertise used cars for prices that are higher than what they expect you to pay. Used-car guides , published monthly, give the average prices for cars that were purchased from dealers during the previous month.

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8-3 HOW DO WE PURCHASE A USED AUTOMOBILE?

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  1. 8-3 HOW DO WE PURCHASE A USED AUTOMOBILE? • Automobile dealers usually advertise used cars for prices that are higher than what they expect you to pay. • Used-car guides, published monthly, give the average prices for cars that were purchased from dealers during the previous month. • The information can help you make decisions about how much to pay for a used automobile. Average Retail Price= Average Retail Value + Additional Options – Options Deductions – Mileage Deduction

  2. LET’s PRACTICE • Jackie Morris would like to purchase a Palamino Spirit, model I59, 2-door hardtop that is advertised for $5195. It has an AM/FM stereo radio and no air-conditioning. It has been driven 78,000 miles. The used-car guide indicates that $275 should be subtracted if the mileage is between 75,000 and 80,000 miles. What is the average retail price should Jackie keep in mind when she makes an offer for the car? Find the average retail price. $6175 + $100 - $500 - $275 = $5500 average retail price

  3. 8-4 Automobile Insurance • Liability insurance protect you against financial losses if you car is involved in an accident. • Comprehensive insurance protect you from losses due to fire, vandalism, theft, and so on. • Collision insurance pays to repair the damage to your car if it is involved in an accident. • A deductable clause means you pay the first $ amount of the repair bill. • The annual base premium is determined by the amount of insurance you want, the age group of your car, and the insurance-rating group.

  4. Continued • Annual Base Premium = Liability Premium + Comprehensive Premium + Collision Premium Annual Premium = Annual Base Premium X Driver Rating Factor

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