1
QuizMultiple Choice

Leasing vs. Buying a Car — Quiz

Question 1 • Personal Finance

Cindy has decided to lease a car. The lease includes a money factor of 0.00354 What interest rate is Cindy being charged in her lease?

Answer
A
14 point 7 5 percent
B
1 point 4 7 5 percent
C
8 point 5 percent
D
0 point 8 5 percent

Explanation

To convert a lease money factor to an approximate annual interest rate, multiply it by 2,400. Cindy’s rate is 0.00354 × 2,400 = 8.496%, which rounds to 8.5%. The correct choice is 8.5 percent.

AI-written and checked against the verified answer.

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