help with practice problem 5

Your friend Harold is trying to decide whether to buy or lease his next vehicle. He has gathered information about each option but is not sure how to compare the alternatives. Purchasing a new vehicle will cost $28,500, and Harold expects to spend about $700 per year in maintenance costs. He would keep the vehicle for five years and estimates that the salvage value will be $11,300. Alternatively, Harold could lease the same vehicle for five years at a cost of $3,705 per year, including maintenance. Assume a discount rate of 11 percent. Required: 1. Calculate the net present value of Harold's options. (Future Value of $1. Present Value of $1, Future Value Annuity of \$1, Present Value Annuity of $1. .) 2. Advise Harold about which option he should choose. Complete this question by entering your answers in the tabs below. Advise Harold about which option he should choose. Your friend Harold is trying to decide whether to buy or lease his next vehicle. He has gathered information about each option but is not sure how to compare the alternatives. Purchasing a new vehicle will cost $28,500, and Harold expects to spend about $700 per year in maintenance costs. He would keep the vehicle for five years and estimates that the salvage value will be $11,300. Alternatively, Harold could lease the same vehicle for five years at a cost of $3,705 per year, including maintenance. Assume a discount rate of 11 percent. Required: 1. Calculate the net present value of Harold's options. (Future Value of \$1. Present Value of \$1, Future Value Annuity of $1, Present Value Annuity of $1. 2. Advise Harold about which option he should choose. Complete this question by entering your answers in the tabs below. Calculate the net plesent value of Harold's options. (Future Value of $1, Present Value of $1, Future Value Annuity of Note: Use appropriate factor(s) from the tables provided. Negative amounts should be indicated by a minus sign. Round your $1, Present Value Annuity of $1. final answers to 2 decimal places. TABLE 11.1A Future Value of $1 TABLE 11.2A Present Value of $1 TABLE 11.3A Future Value of an Annuity of $1 TABLE 11.4A Present Value of Annuity of $1