Question

FINA 3328 WEEK 2 - D2

How many of you would buy a car and how many would lease if you had a choice right now? There are many legitimate reasons to buy or to lease; please use the textbook or any other sources to back up your answer.

Answer #1

Given an option to own vs. lease, in general, leasing the asset is economically better than owning the asset. The PV of leasing the asset is usually better than that of owning the asset. I will therefore prefer to lease the asset.

Reasons: Why i prefer leasing?

- There is no down payment required. Hence, there is no question regarding affordability.
- Lease payments are relatively lower than monthly mortgage payments and hence affording a lease payment is relatively easier than buying the asset on mortgage.
- If you are on a lease model, it's relatively easier to shift to a new model. Once you buy, you have to kind of stick with the same model or car for a few years at least.
- You don't have to get into the issues of depreciation. You pay one lease rental and the entire lease rental is tax deductible.

You are saving money to buy a Car.
You will need $20,000 as the price of the car today. If you can
make a down payment now of $8000 , and want to pay the rest by
installments,
how much each deposit per month should be if you want to pay
the rest of the amount in 24 months if the interest rate on the
deposit is 6% per year?
If you can deposit $664 per month how long will...

You buy a car, which cost $320.000. The purchase can be
financed with a payment of 20% and the remaining 80% is covered by
an 8-year annuity loan. The loan bears interest rate of 3% p.a.,
and it has monthly terms in the following you therefore also apply
a discount rate of 3% p.a.
a) Determine the size of the payment, U, and the monthly
payment, Y, belonging to the loan.
You consider if it is realistic to sell the...

Just based on inflation, how much would we have to make today to
buy the same items in the year you were born? Let's assume to buy a
house in the year you were born, it would cost $100,000. The prices
of houses have gone up for a number of reasons, but some of that
increase has been due to inflation. How much inflation have we had
in your lifetime? What is the amount that you would need today to...

You've been saving up for a new car that you think costs
$25,000. You already have $10,000 and you think that, with interest
and additional savings, the $10,000 will grow to $20,000 in three
years. Suddenly, the phone rings and a voice at the other end of
the line tells you that you've won $5,000. You have the choice of
collecting the $5,000 immediately, or collecting it in three years
which will give you enough money to buy the car....

question1
You can buy and sell currency at the following exchange
rates:
??? 0.047/???, ???
17.25/???, ??? 0.79/???
a.Is there an arbitrage in these exchange rates? Please provide
evidence for your answer.
b.If you start out with USD 100,000, what trades would you make
to take advantage of any arbitrage you find? How many USD would you
end up with?

2. You want to buy a new car 3 years from now, and you
plan to save $1,000 per month, beginning today. You will deposit
your savings in an account that pays a 3.6% annual interest. How
much will you have 3 years from now?
A. $43, 201.80
B. $35,179.30
C. $38, 069.70
D. $27, 338.30
3. Dell computer has two promotions to sell its $3,000
laptop computers. One promotion is the low interest rate loan (the
nominal annual interest...

In the southeast, how many months would you recommend watering a
tree that was 3 inches in caliper at planting? How much water would
you provide during the growing season per week if there had been no
rain?

You can buy and sell currency at the following exchange
rates:
USD 0.047MXN,MXN
17.25CAD,USD 0.79CAD
1A. Is there an arbitrage in these exchange rates? Please
provide evidence for your answer.
1B. If you start out with USD 100,000, what trades would you
make to take advantage of any arbitrage you find? How many USD
would you end up with?

How would you define pluralism? focus on pluralism,
concentrating on religion and religious oppression.
Use concepts and
specific examples from, history, current events, the media or other
external sources, and the textbook to either support or oppose the
following statement:
"Pluralism is the
greatest philosophical ideal of our time."

Consider your favorite fruit or other staple that you consume
often every week (beer, milk, hamburger, etc.). How often do you
consume the item per week (let that number equal āNā)? Now
calculate how much you would be willing to pay if you only could
buy 1, how about 2, continue this exercise until you arrive at āNā
(the number you consume per week). Finally take the difference
between the price you were willing to pay and the market price...

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