(Car leasing) You’re considering leasing or purchasing a car. The details of each method of financing are given below:

a. The lease is for 24 months. What should you do?

b. What will be your answer if the estimated market value of the car at the end of the lease is $10,000? Show a data table with your answer for market value of the car at the end of the lease between $10,000 and $18,000 jumping by $500.

Transcribed Image Text:

A B D E F 1 2 MSRP 3 Capitalized cost 4 Destination charge 5 Acquisition fee 6 Security deposit 7 8 Payment due at signing 9 Monthly payment 10 AUTO LEASE VERSUS PURCHASE 11 Residual value after 2 years as % of MSRP 12 Lease residual value after 2 years 13 Your estimated residual value 14 15 Bank loan cost (annual) 50,000.00 Manufacturer's suggested retail price 45,000.00 < Negotiated price, the actual price you pay for the car Paid both by the lessee and the buyer 415.00 450.00 Paid only by the lessee 450.00