Mathematics · Financial Aptitude
A construction firm needs a crane for an 18-month project. The crane costs ₹10,00,000 to purchase. A company offers an operating lease for 18 months at a monthly rental of ₹60,00, payable at the end of each month. Alternatively, the firm can take a bank loan at 12% per annum simple interest to buy the crane, and sell it after 18 months for an estimated residual value of ₹4,00,000. Neglecting taxes and depreciation, what is the difference in total cost between leasing and buying?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1Buying is cheaper by ₹2,00,000
- 2Leasing is cheaper by ₹1,20,000
- 3Buying is cheaper by ₹3,00,000✓
- 4Leasing is cheaper by ₹50,000
Correct answer
Buying is cheaper by ₹3,00,000
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