A driver must decide whether to buy a new car for $24,000 or lease the same car over a four-year period. Under the terms of the lease, she can make a down payment
of $3000 and have monthly payments of $150. At the end of the four years, the leased car has a residual value (the amount she pays if she chooses to buy the car at
the end of the lease period) of $11,000. Assume she can sell the new car at the end of the four years at the same residual value. Is it less expensive to buy or
to lease?