Question
Tony and Savannah would like you to help them address some of their financial goals. They would like to know if Savannah should lease or
Tony and Savannah would like you to help them address some of their financial goals. They would like to know if Savannah should lease or buy (finance) her next car (2021 Toyota Rav 4). They try to change their car every 4 years. Assume 2% inflation.
Additional Information:
Finance Option:
MSRP: $26,000
Interest Rate: 3 %
Down payment required: 30%
Residual Value: Please use Kelleys Blue Book for approximate value of the car in 4 years.
Lease Option:
Monthly Lease payment: $189
Due at leasing: $2,999
Use $20, 741 for the estimated Blue Book Residual Value for 2021 Rav 4 model.
What is the PV of the lease option? (Please show your calculation on excel)
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