The concept of this problem is to make the decision to buy a new car.
"Purchasing a new car"
I like that some OTA help me to find all of the Pros and Cons of making the decision to purchase a new car.
We need to put the managerial economics concepts into focus....into practical application.
Please be advise that the require concepts must be logical concepts and no from the web site.© BrainMass Inc. brainmass.com October 24, 2018, 5:25 pm ad1c9bdddf
The decision to buy a new car can start from the substitutability of a car versus all the other choices. Of course, this utility (satisfaction/need) depends on the individual. The choices can include public transportation, walking, motorcycle, bicycle, car, etc.
Assuming the decision is to buy a car after all, then next comes what kind of car will satisfy the demand of the customer. This question depends on the supply and demand of each particular type of car. For example, is cost a ...
The decision to buy a new car can start from the substitutability of a car versus all the other choices.
Buy or Lease Decision for a New Car?
You can buy a car for $25,000 and sell it in 5 years for $5,000. Or you can lease the car for 5 years for $5,000 a year. The discount rate is 12 percent per year.
a. Which option do you prefer?
b. What is the maximum amount you should be willing to pay to lease rather than buy the car?