You just leased a Honda Civic that sells for $25,350. The terms of your lease requir you to make 60 payments of $310 per month with the first payment due the day th car was leased. At the end of 5 years you would have to pay $11,862 to buy the car. What effective rate are you paying on the car lease? 5.46% 5.38% 31.87% 5.51%
You just leased a Honda Civic that sells for $25,350. The terms of your lease requir you to make 60 payments of $310 per month with the first payment due the day th car was leased. At the end of 5 years you would have to pay $11,862 to buy the car. What effective rate are you paying on the car lease? 5.46% 5.38% 31.87% 5.51%
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:You just leased a Honda Civic that sells for $25,350. The terms of your lease require
you to make 60 payments of $310 per month with the first payment due the day the
car was leased. At the end of 5 years you would have to pay $11,862 to buy the car.
What effective rate are you paying on the car lease?
5.46%
5.38%
31.87%
5.51%
5.60%
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