1. Buy Versus Lease. Amanda Forsythe of Tampa, Florida, must decide whether to buy or lease a car she has selected.

She has negotiated a purchase price of $24,700 and could borrow the money to buy from her credit union by putting $3000 down and paying $515 per month for 48 months at 6.5 percent APR. Alternatively, she could lease the car for 48 months at $310 per month by paying a $3000 capital cost reduction and a $350 disposition fee on the car, which is projected to have a residual value of $8100 at the end of the lease. Use the Decision-

Making Worksheet on page 230 to advise Amanda about whether she should buy or lease the car.