Donald Shelby

Dr. Blaylock
9/20/2015
Ch. 5 Critical Thinking Case A
1
They should research the car that fits their personal needs. Select the best item for them.
Buy or lease the car at the terms they bargain for and the cost to maintain that vehicle. They
can find this information on the internet in many websites focused on the car they want.

They need to know if they want to keep the vehicle in the end or do they are finically able to get a loa
help pay for the car. The advantages is taking out the loan they would own the car in the end of their
payments. The loans monthly payment is often higher. The advantage is that you own the car after yo
finish the payments. The disadvantage of leasing is that the cost of keeping the car might be too
expensive. Another is there could be a limit over a certain mileage in which you have to pay extra in t
end. An advantage to leasing is if you dont want to keep the vehicle after the payments are done you
can get a newer car and lease that one and if you dont have the funds to pay for the car leasing
payments are less expensive.
3a.

3b.

Lease
1 Initial payment
a. Down payment
$
b. Security deposit
$ 245.00
2 Term of lease and loan
3 Term of lease and loan
4 Monthly Lease payment
5 Total payments over lease
6 intrest rate earned on savings
7 Oppurtunity cost of intial payment
8 Payment/refund
9 Total Cost of leasing
Purchase
10 Purchase price
11 Down payment
12 Sales tax rate
13 Sales tax
14 Monthly loan payment
15 Total payments over term of loan
16 Oppurtunity cost of down payment
17 Estimated Value of the car at end of loan
18 Total cost of purchasing
The certain millaege if you exceed would cause a cost per
tear is an extra cost.

245.00
4
48
$
245.00
$ 11,760.00
0.03
$
29.40
$
350.00
$12,139.40

$ 17,000.00
$ 2,000.00
0.06
$ 1,020.00
$
345.44
$ 16,581.12
$
240.00
$ 6,775.00
$13,066.12
mile over. Unreasonable wear a

3c.

The Harrisons should lease because there is no down payment just a security deposit.

est item for them.

that vehicle. They
ar they want.

e finically able to get a loan to

the car in the end of their
at you own the car after you
g the car might be too
you have to pay extra in the
he payments are done you
ay for the car leasing

over. Unreasonable wear and

just a security deposit.