An SUV sells for $34 200 and can be leased for $348.00 per month plus taxes for a 48-month lease.  A down payment of $3500 is required and the residual value of the SUV at the end of the lease is $16 495.00.  At the end of the lease, the vehicle will be purchased for the residual value plus taxes.  This amount will be financed for three years at 4%.   a)  Calculate the total cost of the lease.   b)  Calculate the total cost to finance the residual value of the vehicle.   c)  What is the total amount paid to lease and then purchase the SUV?

College Algebra
10th Edition
ISBN:9781337282291
Author:Ron Larson
Publisher:Ron Larson
Chapter1: Equations, Inequalities, And Mathematical Modeling
Section1.3: Modeling With Linear Equations
Problem 3ECP: Your family has annual loan payments equal to 28 of its annual income. During theyear, the loan...
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An SUV sells for $34 200 and can be leased for $348.00 per month plus taxes for a 48-month lease.  A down payment of $3500 is required and the residual value of the SUV at the end of the lease is $16 495.00.  At the end of the lease, the vehicle will be purchased for the residual value plus taxes.  This amount will be financed for three years at 4%.

 

a)  Calculate the total cost of the lease.

 

b)  Calculate the total cost to finance the residual value of the vehicle.

 

c)  What is the total amount paid to lease and then purchase the SUV?

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