1. A company provides its representatives with a car for their official company use. The company must determine whether to buy or rent the car they will use. The company has the following options: • Buy the car with an initial outlay of $50,000 plus 24 fixed monthly payments of $3,500 that include insurance. At the end of 24 months, the car can be sold for $59,400. • Rent a car for $2,200 per month plus $0.15 per mile traveled and a one-time payment of $7,500 for auto insurance valid for two years. The company estimates the average of its trips per month will be 850 miles per month for the next two years. Which option is the most convenient for the company in terms of lower costs?
1. A company provides its representatives with a car for their official company use. The company must determine whether to buy or rent the car they will use. The company has the following options: • Buy the car with an initial outlay of $50,000 plus 24 fixed monthly payments of $3,500 that include insurance. At the end of 24 months, the car can be sold for $59,400. • Rent a car for $2,200 per month plus $0.15 per mile traveled and a one-time payment of $7,500 for auto insurance valid for two years. The company estimates the average of its trips per month will be 850 miles per month for the next two years. Which option is the most convenient for the company in terms of lower costs?
Algebra and Trigonometry (6th Edition)
6th Edition
ISBN:9780134463216
Author:Robert F. Blitzer
Publisher:Robert F. Blitzer
ChapterP: Prerequisites: Fundamental Concepts Of Algebra
Section: Chapter Questions
Problem 1MCCP: In Exercises 1-25, simplify the given expression or perform the indicated operation (and simplify,...
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1. A company provides its representatives with a car for their official company use. The company must determine whether to buy or rent the car they will use. The company has the following options:
• Buy the car with an initial outlay of $50,000 plus 24 fixed monthly payments of $3,500 that include insurance. At the end of 24 months, the car can be sold for $59,400.
• Rent a car for $2,200 per month plus $0.15 per mile traveled and a one-time payment of $7,500 for auto insurance valid for two years.
The company estimates the average of its trips per month will be 850 miles per month for the next two years. Which option is the most convenient for the company in terms of lower costs?
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