Lease payments due at the beginning of the month

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Reference no: EM131448737

Suppose that the dealer offers to lease you the car for $297/mo. For 16 months with $4,000 down, lease payments due at the beginning of the month. Assume that if you buy the car the estimated value in 5 years will be $4,000.

Should you lease or buy, and how much of an advantage does it provide you? ( assume that an APR of 5% is correct.)

How about if you should be charged 4% EAR (assume that the dealer is still offering the same payment terms above)

Reference no: EM131448737

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