LEASE

$1$a$.$ Capital Cost Reduction $

$1$b$.$ Security Deposit

$1$c$.$ Total Initial Payment

$2.$ Number of Months in Lease

$3.$ Monthly Lease Payment

$4.$ Total Payments over Lease Term

$5.$ Opportunity Cost of Initial Payment

$6.$ Estimated End$-$of$-$Term Charges $0\mathrm{.}00$

$7.$ Total Cost of Leasing $

PURCHASE

$8.$ Purchase Price

$9.$ Down Payment

$10.$ Sales Tax on Purchase

$11.$ Monthly Loan Payment

$12.$ Total Payments over Term of Loan

$13.$ Opportunity Cost of Down Payment

$14.$ Estimated Vehicle Value at End of Loan

$15.$ Total Cost of Purchase $

Based on this analysis, Noah should:

Use the lease to purchase the Volvo, because its total cost is greater than the total cost of a purchase transaction

Use the loan to purchase the Volvo, because its total cost is less than the total cost of a lease transaction

Use the lease to purchase the Volvo, because its total cost is less than the total cost of a loan transaction