EBK CORPORATE FINANCE
4th Edition
ISBN: 9780134202785
Author: DeMarzo
Publisher: VST
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Chapter 25, Problem 3P
Consider a five-year lease for a $400,000 bottling machine, with a residual market value of $150,000 at the end of the five years. If the risk-free interest rate is 6% APR with monthly compounding, compute the monthly lease payment in a perfect market for the following leases:
- a. A fair market value lease
- b. A $1.00 out lease
- c. A fixed price lease with an $80,000 final price
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You are thinking of leasing a Toyata Rav 4The price of the Toyata Rav 4 is $51,640. You have $8.950 for a down payment. The term of the lease is Six years, and the interest rate is 6.61% compounded Semi-Monthly The buyout on the lease is 41% of its purchase price(note: this is the price before the down payment is subtracted) and it is due at the end of the term if the customer wishes to keep the vehicle. What is the Residual Value in dollars? (Do not round intermediate calculations and round your final answer to 2 decimal places) What is the Present Value? (Do not round intermediate calculations and round your final answer to 2 decimal places.) What are the Semi-Monthly lease payments? (Do not round intermediate calculations and round your final answer to 2 decimal places
1. Suggest you are going to lease a car with an MSRP of $30 000. The manufacturer has set a residual of 60% for a 3-year lease. The dealer has agreed to a selling price of $28 000, and there's a rebate of $500 from the manufacturer. Also you will have a $1 700 advance payment and the lease carries an interest rate of 9% per year. How much would your monthly pretax lease paymentsbe?
Manufacturer's Suggested Retail Price
MSRP
USD
30,000.00
Negotiated sales price
NSP
USD
28,000.00
Lease Term
LT
month
36.00
Residual persentage
RP
dec.
0.60
Advance payment
AP
USD
1,700.00
Rebate
R
USD
500.00
Interest Rate
APR
%
9.00
Calculate the following
1. Calculation of Depreciation fee:
Net capitalized cost
NCC
USD
25,800.00
Residual Value
RV
USD
18,000.00
Depreciation over lease term
Dt
USD
7,800.00
Depreciation charge (monthly)
D
USD
216.67
2. Calculation of Finance fee (Rent charge):
Money factor
MF
-
0.003750
Finance fee (monthly)
F
USD
164.25…
Chapter 25 Solutions
EBK CORPORATE FINANCE
Ch. 25.1 - In a perfect capital market, how is the amount of...Ch. 25.1 - Prob. 2CCCh. 25.2 - Prob. 1CCCh. 25.2 - Is it possible for a lease to be treated as an...Ch. 25.3 - Why is it inappropriate to compare leasing to...Ch. 25.3 - Prob. 2CCCh. 25.3 - Prob. 3CCCh. 25.4 - Prob. 1CCCh. 25.4 - Prob. 2CCCh. 25 - Suppose an H1200 supercomputer has a cost of...
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