Tim needs a new car while he attends college in the united states for the next three years. the car he would like has a msrp
of $15,000. a local dealer can get him a 3-year loan with a 7% interest rate if tim can give them a $1,500 down payment
the same dealer offers the same car to lease with a money factor of 0.00271 and a residual value of 75%. the lease requires
an additional fee of $1,250 to cover tim's security deposit and the acquisition and documentation fees for the car.
tim is looking to drive the car home with the smallest initial out-of-pocket cost. which of the following statements is true?
a. the initial out-of-pocket cost is less for the lease.
b. the initial out-of-pocket cost is less for the loan.
c. the initial out-of-pocket cost is the same for the lease and loan.
d. the initial out-of-pocket cost for a lease is not comparable to that of a loan.