Use the Information for the Question(s) Below

Use the information for the question(s) below.
Your firm needs to invest in a new delivery truck. The life expectancy of the delivery truck is five years. You can purchase a new delivery truck for an upfront cost of $200,000, or you can lease a truck from the manufacturer for five years for a monthly lease payment of $4,000 (paid at the end of each month) . Your firm can borrow at 6% APR with quarterly compounding.
-The monthly discount rate that you should use to evaluate the truck lease is closest to:

A) 0.487%
B) 0.512%
C) 0.498%
D) 0.500%

Correct Answer:

Verified

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