Leasing: Chrysler Corporation - 1995

Posted: 8 May 1997

See all articles by James Angel

James Angel

Georgetown University - Department of Finance

Date Written: March 1997

Abstract

SUBJECT AREAS: Finance, time value of money, leasing, financing as a marketing tool.

CASE SETTING: 1995, USA, Automotive Industry.

Toyota has just introduced a low-priced leasing deal that has hurt sales of the Chrysler Cirrus. Steve Bartoli, a young MBA at Chrysler, needs to craft a response. This applied time value of money case introduces students to leasing in the context of a pricing case. Students explore the use of financing as a marketing tool as they calculate the present value of various promotional financing tactics, including low-interest-rate loans and discounted-lease deals. The case includes an introductory note on leasing, and is rich in institutional detail concerning the car buying process and how automotive lease payments are calculated.

JEL Classification: L10, L62

Suggested Citation

Angel, James J., Leasing: Chrysler Corporation - 1995 (March 1997). Available at SSRN: https://ssrn.com/abstract=9263

James J. Angel (Contact Author)

Georgetown University - Department of Finance ( email )

McDonough School of Business
Washington, DC 20057
United States
202-687-3765 (Phone)
202-687-4031 (Fax)

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