Suppose that you wish to buy a new car that will cost you $75000. If you must put $15000 down, and will finance the rest at 4% APR for the next 60 months, paid at the beginning of each month.

Question) Instead of buying,the dealer offers to lease you the car worth $75000 for $1123/mo. for 60 months with $10500 down, lease payments due at the beginning of the month. Assume that if you buy the car, the estimated value in 5 years will be $7500. Should you lease or buy, and how much of an advantage does it provide you? (Assume that an APR of 4% is correct.)

A) Buy, > $2800

B) Doesn't matter, the costs differ by less than $100

C) LEASE, <$2800

D)BUY, <$2800

E) LEASE, >$2800