11.3 Accounting in the Headlines – Payback

Should you rent a cable modem from Time Warner Cable or buy one?

time-warnerWhen you have internet service from Time Warner Cable, you will need a cable modem.  Time Warner will rent you a modem for $5.99 per month.  Alternatively, you could purchase your own cable modem.  For example, you could purchase the Motorola Surfboard SB6121 cable modem from Amazon for $79.99.

Questions

  1. What is the payback period (in months) if you decide to purchase the Motorola Surfboard SB6121 cable modem?
  2. What are the advantages to renting a cable modem from Time Warner?
  3. What are the advantages to buying a cable model from Time Warner?