Question

Susie leases a $13,000 car for three years. The estimated resell value at the end of the lease term is $7,683. The interest rate is 5.1%. Susie will pay on her lease monthly. What is the depreciation fee?

a) $43.95
b) $147.69
c) $249.53
d) $7,683.00

Answer 1

The depreciation fee is the difference between the initial value of the car and its estimated resell value at the end of the lease term. In this case, the depreciation fee is $13,000 - $7,683 = $5,317.

To calculate the monthly payment on the lease, you would need to know the length of the lease in months, the interest rate, and the depreciation fee. You can then use the following formula to calculate the monthly payment:

Monthly payment = (Interest rate / 12) x (Initial value - Resell value) / Length of lease in months

For example, if the length of the lease is 36 months, the monthly payment would be:

Monthly payment = (5.1% / 12) x ($13,000 - $7,683) / 36 months = $114.78

Keep in mind that this is just an example calculation and the actual monthly payment on Susie's lease may be different depending on the specific terms of the lease agreement.

Explanation: