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Find the total value of leasing to buy the dining set

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Question - You can purchase a new dining room set for $6,199.95 or you can lease it with monthly payments of $240 made at the beginning of each month for 2.5 years. At the end of the lease you will own the dining set with a payment of 10% of the original selling price (retail price). Interest is 6.0% compounded monthly.

a. Find the total value of leasing to buy the dining set in current dollars.

b. Was it economically better for you to purchase the set today or lease to buy it?

c. How much did you save by using the less expensive method to own this set?

Reference no: EM133066384

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