12
QuizMultiple Choice

Personal Loans

Question 12 • 1442 Personal Finance B CA

Cindy would like to borrow money from her bank to restore her collectible car. It will take $12,000 to fully restore the car. Cindy's bank offers secured loans at 89% of the collateral value. How much collateral does Cindy need to offer to get a loan big enough to allow her to fully restore her car?

Answer
A
$3,100
B
$10,680.00
C
$12,000.00
D
$13,483.15

Explanation

The bank will lend 89% of the collateral’s value, so Cindy needs collateral worth enough that 0.89 × value = $12,000. Dividing $12,000 by 0.89 gives about $13,483.15, so the correct choice is $13,483.15.

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