lease-vs-buy decision
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Provide an example from your personal or work experience of a lease-vs-buy decision. Explain why you/your company made the decision it did.
What working capital techniques would you recommend for your organization (or another organization)? Why?
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Provide an example from your personal or work experience of a lease-vs-buy decision.
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Provide an example from your personal or work experience of a lease-vs-buy decision. Explain why you/your company made the decision it did.
From personal experience, I will provide an example of decision made for leasing a car.
When you buy, you pay for the entire cost of a vehicle, regardless of how many miles you drive it. You typically make a down payment, pay sales taxes in cash or roll them into your loan, and pay an interest rate determined by your loan company, based on your credit history. You make your first payment a month after you sign your contract. Later, you may decide to sell or trade the vehicle for its depreciated resale value.
When you lease, you pay for only a portion of a vehicle's cost, which is the part that you "use up" during the time you're driving it. You have the option of not making a down payment, you pay sales tax only on your monthly payments (in most states), and you pay a financial rate, called money factor, that is similar to the interest on a loan. You may also be required to pay fees and possibly a security deposit that you don't pay when you buy. You make your ...
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- BCom, SGTB Khalsa College, University of Delhi
- MBA, Rochester Institute of Technology
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