Car Project

P10 Life Project:
You have graduated from high school and discover within you life scenario that you need a car.
It seems that there is no other option at this point. You must research all the costs of purchasing
a used car. You may purchase through a dealer or privately. Let’s assume you maximum
purchase price before tax is $13,000. Check out the Buy and Sell at or
Craigslist Vancouver at .
Part A. Research the car.
1. Car Profile Summary(2 marks): Choose a car that you would like to purchase and
describe the car. Include the advertisement and picture.
2. Buyer Beware! (5 marks): It is essential to know the details before you buy. Make a list
of questions you would ask the previous owner BEFORE buying the car. You can’t ask
enough questions (minimum 5 good questions).
3. Purchase Price (5 marks): First you need to know if you are buying from a dealer or
privately. GST & PST is applied to sales (12%). We will assume you will pay the full
price listed (often you can bring the price down, especially in the case of a private sale).
You must included in your purchase price all “start up costs”:
Listed price +
Purchase taxes (12%) +
Aircare (depends on year, go to and look at the FAQ) +
Other: estimate any extra cost to address immediate repair issues (ex. fix the
brakes, get new tires) or plans you have to modify the car (ex. add a new radio),
make sure to choose at least one!
e. =total cost of buying car.
4. Monthly Auto Expense Summary (8 marks): Record the monthly auto expenses you
will incur. Consider both you loan payments and driving expenses (we will ignore
depreciation for this project!).
a. Maintenance: This again will vary depending on what type of vehicle you
purchase and how much you drive. The Canadian Automobile Association
estimate that Canadians drive 18, 000 km in a year or 1500 a month. Estimate the
distance you will drive in one month based on your future habits and lifestyle (ie.
to and from school or work, etc.), provide a written description of how you arrive
at your km driven total. Use to plot your routes and record
i. Record km estimate and written summary of where you will drive
ii. Fuel economy: Google the make and year of car with km per litre or some
similar search to find the amount. Calculate the amount of gas (in litres) for
the km you will drive (kms / km/litre)
iii. Calculate fuel cost (litres used x current price per litre)
iv. Calculate maintenance cost (2.84 cents / km driven)
v. Calculate tire cost (1.65 cents / km driven)
Total monthly maintenance cost (fuel + maint. + tires): _________________
i. Insurance: Use $2200 as your figure.
b. Bank loan payments (2 marks). To begin you must determine the size of your
loan. The formula will look something like this: total purchase price – down
payment (provide the amount you are able, or must put down). Typical down
payments are in the area of 10 %)
Next you must find use a 7% interest rate, assume you will pay the loan back
within 36 months, and calculate the monthly loan payment using the following
i. (Purchase price) – (family support) – (down payment). = Loan required
ii. Monthly loan payment ___________________
iii. Total repayment amount (monthly payment x # months) and
iv. Cost of loan (total repayment – amount borrowed).
c. Total Monthly Auto Expenses: Record: monthly loan payment + monthly total
maintenance cost per month + monthly insurance cost (3 marks).