15
QuizMultiple Choice

Leasing vs. Buying a Car

Question 15 • 26-27 Ignite Technical Math-Financial Math - MA2007

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
0.85%
B
8.5%
C
1.475%
D
14.75%

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%. So she is being charged 8.5% interest.

AI-written and checked against the verified answer.

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