Make you indifferent between buying and leasing

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Reference no: EM13918819

After deciding you want a new car, you can either lease the car or purchase it with a four-year loan. The car you want costs $37,000. The dealer has a special leasing arrangement where you pay $103 today and $503 per month for the next four years. If you purchase the car, you will pay it off in monthly payments over the next four years at an APR of 7 percent. You believe that you will be able to sell the car for $25,000 in four years. What is the present value of purchasing the car? (Do not round intermediate calculations and round your final answer to 2 decimal places (e.g., 32.16).) Present value $ $11,786.22 What is the present value of leasing the car? (Do not round intermediate calculations and round your final answer to 2 decimal places (e.g., 32.16).) Present value $ ($24,041.00) What break-even resale price in four years would make you indifferent between buying and leasing? (Do not round intermediate calculations and round your final answer to 2 decimal places (e.g., 32.16).) Break-even sale price $

Reference no: EM13918819

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Make you indifferent between buying and leasing : After deciding you want a new car, you can either lease the car or purchase it with a four-year loan. The car you want costs $37,000. The dealer has a special leasing arrangement where you pay $103 today and $503 per month for the next four years. Wh..

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