Question: You are trying to decide between taking the bus to work or buying a car and driving. Assume that a bus pass costs $90/month but
You are trying to decide between taking the bus to work or buying a car and driving. Assume that a bus pass costs $90/month but that when you use the bus you also need to take a taxi to/from the bus stop at an additional cost of $120/month. Both costs are paid at the end of each month. You can buy a good used car for $6000. It will last for 5 years and be you can sell it for $1000 in spare parts at the end of that time. In addition, gas and parking cost $125/month (also paid at the end of the month). Your cost of capital is 6% (EAR). What is the monthly cost of using the bus
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