(Do not round intermediate calculations and round your answer to 2 decimal place

Question

(Do not round intermediate calculations and round your answer to 2 decimal places)

C.)What break-even resail price in two yeasrs would make you indifferent between buying and leasing? Whats the break-even resale price?

B.)What is the cost today of leasing the car?

A.) What is the cost today of purchasing the car?

After deciding to get a new car, you can either lease the car or purchase it with a two year loan. the car you wish to buy costs 38,500. the dealer has a special leasing arrangement where you pay $106 today and $506 per month for the next two years. if you purchse the car, you will pay it off in monthly payments over the next two years at an APR of 7%, compounded monthly. you believe that you will be able to sell the car for 26,500 in two years.

Explanation / Answer

Answer: -

Answer-A: -

Purchasing the Car: -

Answer-B: -

Leasing the car: -

Answer-C: -

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