The BMW Project The project is due on Tuesday, May 2nd;; each student must submit an Excel file on canvas or a hard copy of their calculations in class, denending whether they'd like to use Excel or not. The project is based on real information that is obtained from BMW of Eugene, and thus is meant to be a little more challenging than the class material. So, don't feel disappointed if it looks more complicated than what you expected. You are more than welcome to come to office hours or make appointments to get help on the project. The following describes the project's objective, the two alternatives, and the analysis that are asked. Objective: I'd like to buy a brand-new BMW 430i convertible at the end of this year (2023), keep the car for 5 years, and sell it after that (at the end of 2028). I have two different alternatives to purchase this BMW. You are tasked to determine which alternative is the best (cheapest) way to buy the car. Below, I describe each of the alternatives along with all the information you need to understand the cash flows associated with each alternative, and estimate the net present value of ownership of the BMW based on each alternative. Alternative 1: I can finance this BMW with the BMW dealership of Eugene. BMW of Eugene provides qualified customers, with excellent credit history, financing for up to 60 months on any new 2024 BMW 430i Convertible model with 4.35% APR 1. The 2024 BMW 430i Convertible that I have picked has MSRP of $52,950.00, excluding tax, shipment, title, and license. I plan to put a down payment of $1,000 at the beginning and finance the rest of the MSRP with the given APR for 60 months. The dealership also offers a $1,500 credit against the MSRP if I use this alternative (it means that $1,500 off the price). After 5 years, I plan to sell the car. To get an idea of how much I can sell the car for in five years, I looked up the current selling price of a 2019 model of a similar BMW on Auto trader. The 2019 model is currently priced at $24,561. Therefore, assume that I can sell my BMW at the end of 2028 for $24,561. a) Report the cash flow chart of this alternative. b) Calculate the net present value of ownership with this alternative, if the discount rate to calculate the net present value of the cash flow is 3.66%. Note that the APR above should be used to calculate the financing payments (the monthly payments) and the discount rate should be used to calculate the present values of the cash flows. Alternative 2: I can lease the BMW for 36 months and give it back at the end of the lease term. Then, lease a new model for the next 24 months and give it back at the end of 2028 . This way, I will have a BMW for the next 5 years, like alternative 1. Lease is available on new 2024 BMW 430i Convertible models to qualified customers with excellent credit history. For the model I picked with MSRP of $52,950.00, I must put a down payment of $3,000 plus a destination and handling fee of $925 at the beginning. The monthly lease payments are $649 per month for 36 months. After 36 months (in December 2026), I will turn in the 2024 model and lease new BMW 430i Convertible for 24 months (until the end of 2028). The lease agreement is very similar to the first one. I must put a down payment of $3,000 plus a destination and handling fee of $925 at the beginning. However, since it is my second lease, I receive a $1,500 credit against my down payment which reduces it to only $1,500. The monthly lease payments are $549 per month for 24 months. At the end of 2028 , I turn in the car and walk away. a) Report the cash flow chart of this alternative. b) Calculate the net present value of ownership with this alternative, if the discount rate to calculate the net present value of the cash flow is 3.66%. Bottom line: Based on your answers in part b of each alternative, which alternative is the less expensive way to own a BMW 430i Convertible for five years? Lease or finance