The monthly lease payments for a four year lease of the Bulldozer are closest to ________
Suppose the purchase price of a bulldozer is $90,000, its residual value in four years is certain to be $15,000, and there is no risk that the lessee will default on the lease. Assume that capital markets are perfect and the risk-free interest rate is 6% APR with monthly compounding.
A) $1,870
B) $1,825
C) $1,750
D) $2,115
Answer: B
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