Problem $8-33$ Equivalent Annual Annuity $($LO$5)$

A firm can lease a truck for $4$ years at a cost of $$36,000$ annually. It can instead buy a truck at a cost of $$86,000,$ with annual maintenance expenses of $$16,000.$ The truck will be sold at the end of $4$ years for $$26,000.$

a$.$ What is the equivalent annual cost of buying and maintaining the truck if the discount rate is $10\%?$

Note: Do not round intermediate calculations. Round your answer to $2$ decimal places.

Equivalent annual cost

b$.$ Which is the better option?

Lease

Buy