Which of the following lease conditions would result in a capital lease to the lessee?

a. The lessee will return the property to the lessor at the end of the lease term.

b. The lessee can purchase the property for $1 at the end of the lease term.

c. The fair market value of the property at the inception of the lease is $18,000; the present value of the minimum lease payments is $15,977.

d. The lease term is 70 percent of the property’s economic life.