You are considering leasing or buying a new piece of equipment. The lease terms would require $900 monthly payments for the next five years with an additional payment of $2,000 at the end of the fifth year. If you bought the equipment, it would cost you $25,000 in one year, and $30,000 in two years. At the end of the five years, you would be able to sell the equipment for $12,000. Either option has interest of 9% with monthly compounding. Should you rent or buy the new equipment?

a) What is the total cost of leasing?

b) What is the total cost of buying?