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What is the NPV of leasing the car for three years? (HINT: Answer will be a NEGATIVE number) [round to 2 decimal places] What is
What is the NPV of leasing the car for three years? (HINT: Answer will be a NEGATIVE number) [round to 2 decimal places]
What is the NPV of purchasing the car and selling after three years? (HINT: The answer will be a negative number...) [round to 2 decimal places]
At what discount rate would the graduate be indifferent between the two choices? [round the percentage to 2 decimal places]
A young graduate is trying to decide whether to lease or buy a car for the next three years. The cash flows for each choice are shown below. (We wil ignore gas, insurance, and tag fees.) YEAR LEASE PURCHASE $35,987.00 3 $4,250.00 -$3,500.00 -$3,500.00 -$3,500.00 0 $26,239.00 0 0 The graduate has a personal discount rate of 7.00%Step by Step Solution
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