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Your construction company needs to invest in a new truck. The truck is expected to last for five years. You can either purchase the truck

Your construction company needs to invest in a new truck. The truck is expected to last for five years. You can either purchase the truck today for $200,000 or lease the truck for five years by making monthly lease payments of $4000. Your company can borrow at 6% with quarterly compounding.

i) What is the one-month-effective rate of the loan?

ii) Should you buy or lease the truck today?

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