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Otrada [13]
2 years ago
10

Jennifer is leasing a car from a local auto retailer. The terms of the lease include a 9% interest rate for 36 months with a res

idual value of 57%. The MSRP for the car Jennifer is leasing is $17,500. What will Jennifer’s monthly lease payment be? a. $93.84 b. $99.75 c. $209.03 d. $312.06
Mathematics
2 answers:
katrin [286]2 years ago
6 0
1. The problem gives the residual value in percentage, and you need it in dollars. So, if the MSRP for the car Jennifer is leasing is $ 17,500, you have:

 57%/100=0.57

 residual value=$17,500*0.57= $9,975

 2. Then, you need to substract the residual value and the lease term, to calculate the value of the car, as below:

 car value=$17,500-$9,975=$7,525

 3. You need to calculate the money factor, which is the interest rate divided by 2400. Then, you have:

 Interest rate=9%/100=0.09

 Money factor=0.09x2400
 Money factor=0.00375

 4. The interest is:

 I=($17,500+$9,975)(0.00375)
 I=$103.03

 5. Therefore, the monthly payment is:

 Monthly payment=(car value/36 months)+Interest
 Monthly payment=($7,525/36)+$103.03
 Monthly payment=$209.02+$103.03
 Monthly payment=$312.06

 What will Jennifer’s monthly lease payment be?

 The answer is: d. $312.06
Ann [662]2 years ago
3 0
The answer is D..........................
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