How to solve

Use Worksheet $5\mathrm{.}1.$ Joshua Reed is trying to decide whether to lease or purchase a new car costing $$37,000.$ If he leases, hell have to pay a $$1,300$

security deposit and monthly payments of $$703$ over the $48-$month term of the closed$-$end lease. On the other hand, if he buys the car then he'll have to

make a $$3,000$ down payment and will finance the balance with a $48-$month, $6\mathrm{.}5$ percent loan requiring monthly payments of $$858,96,$ hell also have to

pay a $6$ percent sales tax $($$$2,220)$ on the purchase price $($to be included in the financing$),$ and he expects the car to have a residual value of $$11,500$ at

the end of $4$ years. Joshua can eam $3$ percent interest on his savings and plans to include the sales tax in the amount financet on the purchase. Use the

automobile lease versus purchase analysis form in Worksheet $5\mathrm{.}1$ to find the total cost of both the lease and the purchase and then recommend the best

strategy for loshua.

loshua should Purchase or lease the car because it is the least expensive alternative?