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A local car dealership is offering a three - year lease deal for the latest model of the Honda Civic LX for $ 2 2
A local car dealership is offering a threeyear lease deal for the latest model of the Honda Civic LX for
$ per month with $ due at signing. Jared is debating whether he should lease or purchase the
vehicle. While the lease option offers lower monthly payment and down payment and gives Jared the
opportunity to drive a new car in three years without the hassle of having to sell the car, Jared is
wondering if it is financially smart to lease a vehicle. The market price for a Honda Civic LX is $
and the market value of a threeyearold Honda Civic LX is $ The current national average for auto
loan interest rates is on a month loan.
A Build a spreadsheet model that calculates the monthly payment, principal payment, interest payment,
beginning balance, and ending balance for each month of the fiveyear loan period, assuming a down
payment of $ What is the ending balance of the loan at the end of the threeyear period?
B How much would Jared have paid out of pocket at the end of the threeyear lease period if he decides
to lease the vehicle?
C Does leasing or buying make more financial sense to Jared? Why?
D For his weekend hobby of offroad driving, Jared wants to get an AWD Jeep Wrangler instead. A local
dealer is offering a threeyear lease deal for the latest model of an AWD Jeep Wrangler for a monthly
payment of $ with $ down. The same vehicle is for sale for $ Jared found that a three
year old AWD Jeep Wrangler has a market value of $ Using the spreadsheet model, you
developed to find out whether it is less expensive for Jared to lease or purchase? What is the difference
in dollar amount between the two options after three years?
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