Homework Answers
Let no. of Kms driven be M, then
Annual Cost of Lease = 0.25 * M
Annual cost of buying = 8000 * (A/P, 15%,5) + 500 + 0.05 * M - 1500 *(A/F, 15%,5)
As per condition,
8000 * (A/P, 15%,5) + 500 + 0.05 * M - 1500 *(A/F, 15%,5) = 0.25 * M
8000 * 0.298316 + 500 - 1500 * 0.148316 = 0.25 * M - 0.05 *M
2664.051 = 0.20 * M
M = 2664.051 / 0.20 = 13320.26 KMs
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