Math of Finance Performance AssessmentGeorge and Martha have $6000 in a checking account that pays no interest. They want to buy their first car right now, and at the same time save monthly toward a house. The plan is to drive the car for 5 years, then sell it the same month they put the money down on the house. You have been asked to help them decide which car to buy and to determine, based on their plan, the highest price house they can afford to buy.Here are the facts and assumptions as they see them:Part 1 Buying the car. They have narrowed their choice to two models, one from dealer A and one from dealer B.Car A Car B Price $25,000 $20,000 Down payment 8% 15% APR 3.5% 4.5% Months to pay 60 48 Resale value 40% 30% Miles/gallon 35 30Cost of operating the car. In addition to their monthly car payments, G&M will need to buy gas, change the oil, and pay for insurance. They assume gas will average $2.50/gallon over the next 5 years. They drive 20,000 miles each year. Oil changes are $25 every 5000 miles (4 times/year). Insurance and licensing fees are based on the car price, and they figure that 5% of the full price each year will suffice to cover both.Calculate: 1. Monthly and total (5-yrs) payments for both car options, 2. Monthly and 5 year operating cost for both car options, and 3. Total cost of ownership of each car option over the 5 years.Part 2Buying the house The car down payment will come from their bank account, and whatever is left will stay in the checking account as a cash reserve. After all their other monthly expenses, G&M have a net positive cash flow of $1200. They will make the monthly car payments, insurance payments, gas and oil payments from their cash flow of $1200 (so monthlies can never be more than this amount). Any excess cash (from the $1200) will go into a long term savings plan for 5 years that pays an APR of 6% compounded monthly. At the end of the five years, they will sell the car and cash out the long term savings plan, put the amount of their original car down payment back in checking so they can shop for a new car. The remaining long term savings plan balance they will use as a down payment on a new house, which they expect to be 15% of the houses price.Calculate: 1. Total funds in the long term savings plan after 5 years, 2. Funds available for a down payment on a house, 3. Highest house price they can afford, and 4. Monthly payment for a 30-year mortgage at 4.5% APRPart 3Report to George and MaryNow that you have completed your calculations, it is time to create a report for George and Mary, outlining your recommendations to them. In this report you should include the following: The recommended car purchase, with a written justification including formulas and all calculations neatly and completely computed, A written explanation of how you arrived at the amount to be saved monthly, including formulas and all calculations neatly and completely computed, and A written explanation of how you determined the most expensive house they can afford, and the monthly payment resulting from the purchase of that house.