Economic Comparison Honda Accord vs Toyota Prius Team

Economic Comparison: Honda Accord vs. Toyota Prius Team 3 Richard Do Peter Jo Lester Oestreich Carlos Ruiz Jane Veerachanavirut

Objective What car is a better deal in a 5 -year period? Honda Accord 2003 Toyota Prius 2003

Analysis Parameters Gender: Male Finance/Lease Term: 4 Years Age: 25 APR 8. 90% Residence: Pomona, CA Warranty 3 Years Education: BS Engineering Analysis Term 5 Years Credit Score: Good Insurance Coverage 100, 000/300, 000 Salvage Condition Good Insurance Term 1 year Down Payment: 10. 00% Miles Driven per year 15000. 000

Economic Analysis Parameters n n n n Financing Major Maintenance Insurance Salvage Value Gas Costs Scheduled/Minor Maintenance License and Registration Fee

Economic Analysis Method n Net Present Worth and Equivalent Uniform Cost q q n n n NPW=PW of cost – PW of benefits EUC = P(A/P, i, n) - S(A/F, i, n) 5 -year Analysis Term Minimum Attractive Rate of Return 10% Sensitivity Analysis

Initial Analysis Results q q Toyota n NPW $48, 305. 09 n EUC $1, 026. 34 Honda n NPW $43, 208. 82 n EUC $918. 06

Sensitivity Analysis n Factors affecting NPW APR q Insurance q Gas Inflation q Downpayment q Analysis Term q

Conclusion n Honda Accord is the better buy based on: q q n Initial economical analysis. Sensitivity analysis. High maintenance cost of Toyota Prius offsets the savings of its fuel consumption. References: • Toyota. com • Honda. com • KBB. com • Consumerreports. com • Eia. doe. gov

Useful Resources Bankrate. com – www. bankrate. com n Offers current information on the best APR for each loan term new and used n Information on auto loans in general, credit score, buying n Car Buying Guides n Offers a variety of calculators on q q q How much you can afford? New or Used? Buy or Lease? Car Buying Tips - http: //www. carbuyingtips. com/ n Car Buying Guides n Credit Reports, Car Loans, Quotes, and Warranty Information n Information on Financing, Lease, New, Used n Information on how to avoid fraud and current scams n Information on car insurance