Answers26-27 Ignite Technical Math-Financial Math - MA2007Leasing vs. Buying a CarQuestion 12
12
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Leasing vs. Buying a Car

Question 12 • 26-27 Ignite Technical Math-Financial Math - MA2007

Bob is thinking about leasing a car with a MSRP of $24,000 for three years. After three years, the leasing company expects the car to have a value of 72% of its original MSRP. What will the residual value of the car be after three years?

Answer
A
$3,000
B
$6,000
C
$17,280
D
$33,333

Explanation

The residual value is 72% of the car’s original MSRP. Calculate 0.72 × $24,000 = $17,280. Therefore, the car’s residual value after three years is $17,280, choice C.

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