Use the Information for the Question(s) Below

question 32

Multiple Choice

Use the information for the question(s) below.
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.
-Suppose that instead of leasing the bulldozer, the company is considering purchasing a bulldozer outright by borrowing the purchase price using a four-year annuity loan. The monthly loan payments for a four year loan to purchase the Bulldozer are closest to ________.

• A) $2,115
• B) $1,825
• C) $1,870
• D) $1,750

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Definitions:

Baby's Crying

A baby's way of communicating needs or discomfort, ranging from hunger to tiredness or the need for attention.

Discrimination

An unjustified negative or harmful action toward a member of a group simply because the person belongs to that group.

Generalization

Generalization is the process of responding similarly to different but related stimuli, often used in learning and behavioral psychology to explain how individuals can apply what they've learned to new situations.

Spontaneous Recovery

Refers to the reappearance of a previously extinguished response after a period of no exposure to the conditioned stimulus.