What Would Be the Total Cost of Leasing a Vehicle

question 72

Multiple Choice

What would be the total cost of leasing a vehicle for four years that requires a security deposit of $1000 (which would be withdrawn from your portfolio,which earns nine percent per year) ,has monthly lease payments of $500,and has a kilometer restriction of $20000 with excess kilometers resulting in a charge of 10 cents per kilometer? (Assume that,over the life of the lease,you exceed the kilometer limit by 8000.)

• A)$24 420
• B)$24 360
• C)$24 800
• D)$25 160

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Definitions:

Manufacturing Costs

Expenses directly related to the production of goods, including raw materials, labor, and overhead costs.

Administrative Expenses

Costs associated with the general management and administration of a business, such as salaries of executive personnel, legal and accounting fees.

Operating Capacity

The maximum output that a company can produce under normal conditions over a specific period.

Differential Cost

Differential cost, also known as incremental cost, is the difference in total cost that will result from selecting one option over another in decision-making processes.