Your Firm Needs to Invest in a New Delivery Truck

Your firm needs to invest in a new delivery truck. The life expectancy of the delivery truck is five years. You can purchase a new delivery truck for an upfront cost of $350,000, or you can lease a truck from the manufacturer for five years for a monthly lease payment of $7000 (paid at the end of each month) . Your firm can borrow at 9.00% APR with quarterly compounding. The effective annual rate on your firm's borrowings is closest to ________.

A) 9.00%
B) 7.45%
C) 11.17%
D) 9.31%