Purchase the car cash or lease the car

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Reference no: EM131095419

A company needs a new car and has the following options: (1) purchase the car cash or (2) lease the car. They are expecting to use the car for 2 years. If car is purchased for cash: • Cost new, $28,000 • Factory rebate available immediately, $4000 • Salvage value, $12,000 Costs for 2 year lease: • Amount due at signing, $3000 • Monthly lease payments, $400. The monthly payments are made at the beginning of the month (i.e. starting when n = 0)

Reference no: EM131095419

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