Examice

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Question 111

Which of the following statements is true regarding the lessee's ability to purchase the leased property?

The lessor must allow the lessee to purchase the leased property either during the lease term or at the end of the term.

If the lessor allows the lessee to purchase the property at the end of the lease term, the lessor may not charge more than the equivalent of 12 monthly payments for the property.

If the lessor allows the lessee to purchase the property at the end of the lease term, the purchase price must be disclosed in the initial disclosure statement.

The purchase price of the leased property must be mutually agreed on by the lessor and the lessee.

Correct Answer: C

If the lessor allows the lessee to purchase the property at the end of the lease term, the purchase price must be disclosed in the initial disclosure statement. This aligns with the requirements of Regulation M under the Consumer Leasing Act, which mandates that lessors provide lessees with a comprehensive initial disclosure statement. This statement must include key information about the lease, including the terms of any purchase option, ensuring transparency and allowing the lessee to make an informed decision.

Discussion

Cam22Option: C

This statement aligns with the requirements of Regulation M under the Consumer Leasing Act in the United States, which governs consumer leases. Regulation M mandates that lessors provide lessees with a comprehensive initial disclosure statement that includes key information about the lease. If the lease agreement includes an option for the lessee to purchase the leased property at the end of the lease term, the terms of this option, including the purchase price or the method for determining the purchase price, must be clearly disclosed at the outset of the lease.