A situation that is probably useful for many people to understand.

**Problem:**

$12000 cars for $8000 cash or $2000 down payment and $150 a month for 4 years. How much can you save by paying cash?

**Approach:**

Find the total cost of the two options.

Option A: $8,000

Option B: $2,000 + ($150/month)(12 months/year)(4 years)

In option B, you add the initial cost to the rate multiplied by the time (with the correct units)

The find the difference between them.

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