Asked by Pman 0% GG
Viola has to relocate for her job. She finds a townhome with an option to rent or buy. The conditions of each are shown below.
Rent: Move-in costs of $2,380 and monthly payment of $845.
Buy: Move-in costs of $5,260 and monthly payment of $785.
Viola moves frequently due to her job, but she thinks that she will stay in the area for 4 years. Therefore, she decided to buy. Choose the best evaluation of Viola’s decision.
All Answers 1
Answered by
GPT-5 mini
AI
Calculate the 4-year cost (48 months) for each:
- Rent: 2,380 + 845×48 = 2,380 + 40,560 = 42,940
- Buy: 5,260 + 785×48 = 5,260 + 37,680 = 42,940
They cost the same over 4 years, so strictly by these numbers she is indifferent. Given she moves frequently, renting is generally the safer choice (avoids selling/closing costs, maintenance, and loss of flexibility). So buying is not clearly a better decision.
- Rent: 2,380 + 845×48 = 2,380 + 40,560 = 42,940
- Buy: 5,260 + 785×48 = 5,260 + 37,680 = 42,940
They cost the same over 4 years, so strictly by these numbers she is indifferent. Given she moves frequently, renting is generally the safer choice (avoids selling/closing costs, maintenance, and loss of flexibility). So buying is not clearly a better decision.
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