4. A company has spent $60 000 for car rentals over the past 2 years. The

manager wants to determine if the company should continue to rent or if it should buy or lease two cars instead.

A new car costs $31 000. A 10% down payment is required. The rest can be financed at 4.6% interest, compounded monthly, for 2 years. Assume depreciation of 40% a year. After 2 years, the cars are sold for their depreciated value.

A 2-year lease for a car requires a down payment of $3000 and monthly

payments of $900.

Recommend a course of action.

A. Buy the cars, as the cost will be $42 393.

B. Continue to lease the cars for $60 000, as this costs the least. C. Lease the cars, as this will cost $49 200. D. Buy one car for $31 000 and lease one for $28 100.

I need the answers and some guidance thank you.