You can either lease or purchase a certain car. The car costs $$38,500.$

The leasing arrangement is paying $$106$ immediately and then $$506$ per month

for the next two years.

Alternatively, you can purchase the car by taking a loan at $7\%$ APR at monthly

payments. In two years you can sell the car for $$26,500.$

a$)$ What is the present value of the lease?

b$)$ What is the present value of the purchase?

c$)$ What is the break$-$even resale price?