9.2 Dealers Cost 21505

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9.2 Dealers Cost 2/15/05

• Good Morning!
• Please grab a calculator.
• Please write the following title down in your
  notes along with the date.

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Instructions

• Make sure each group has 3 or 4 people
• Each person should choose a number
• 3 person groups- each person chooses 1,2 or 3
• 4 person groups- each person chooses 1,2,3, or 4
• After we read each question, discuss with your
  group and then write down your answer. You do
  not all have to agree. There are no right or
  wrong answers.
• I will call out a number and then point to a
  group. The person with that number should answer
  the question.

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Discussion Questions
Option 1 Write these on your notes and turn
notes in with h/w Option 2 Write these on the
paper that you are going to do your homework on
if you take notes in a separate notebook.
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Discussion Questions

• 1. What three amounts make up the sticker price?

Base Price Options Price Destination Charge
Sticker Price
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Discussion Questions

• 2. Where do you think car dealerships like
  University Ford get their cars from?

• 3. Do you think the Ford dealer has pay the
  company to get a car on their lot?

• 4. How do car dealerships make money?

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Discussion Questions

• 5. Do you think you can find out how much a car
  dealership pays for a car?

6. How much of the full price do you think a
dealer pays for a car?
7. Why might this information be helpful for you?
8. How do you find 5 of 60?
5 of 60 5 x 60 5 / 100 x 60
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Vocabulary

• Dealers Cost- How much the dealer paid for the
  car
• Invoice Cost- the same thing as the dealers
  cost

see www.edmunds.com and http//www.nadaguides.com/
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Formulas

• Dealers cost for base
• dealers cost for options
• destination charge
• Dealers cost

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Dealers Base Price
of Base Price that Dealer pays x Base
Price Dealers Base Price
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Dealers Options Price
of Options Price that Dealer pays x
Options Price Dealers Options Price
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• Chin and Lisa Weng want to purchase a new car.
  The car has a base price of 12,905, options
  totaling 2,010, and a destination charge of
  360. They read in a consumer magazine that the
  dealers cost for the car is about 95 of the
  base price and 89 of the options price. What
  should they estimate as the dealers cost?

Dealers Base Price
95 of 12,905 95/100 x 12905 12,259.75
Dealers options Price
89 of 2,010 89/100 x 2010 1,788.90
Destination charge
360
14,408.65
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How to show work.
Base 95 x 12,905 12,259.75
Options 89 x 2,010 1,788.90
Destination charge 360
14,408.65
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• Ryan is buying a car. The base price is 31,320
  and the options are 1,870. There is a
  destination charge of 500. The dealers cost is
  90 of the base price and 88 of the options
  price. Ryan offers to pay 200 more than the
  dealers cost plus 6 tax. What does Ryan pay?

Dealers Base Price
90 x 31,320 28,188
Dealers options Price
88 of 1,870 1,645.60
Destination charge
500
30,333.60 200 30533.60
6 of 30,533.60 32,365.62
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Question

• How can you decide what price to start
  negotiating with dealer?
• If the dealer pays 25,546 (invoice) for a car,
  and the sticker price (MSRP) is 28,432 how much
  should you suggest that youll pay?

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Assignment

• pg 318 2-16 even, 9, 11 and you must SHOW WORK!