$2.$Nova Corp. is considering the purchase of a $$300,000$ machine that has a $5$ year life

with no salvage value. The asset will generate after$-$tax cash flows of $$98,000$ per year

and the company has a marginal tax rate of $40\%.$ The company has a required rate of

return of $12\%.$ The machine has a CCA rate of $30\%.$ Alternatively, the company can

also lease the machine with lease payments of $$90,000$ per year $($beginning of the year$)$

for $5$ years and the before tax cost of borrowing in the lease is $9\%.(15$ points$)$

A$.$ If the company buys the machine, what is the NPV$?(6$ points$)$

B$.$ If the company leases the machine, what is the NAL? $(8$ points$)$

C$.$ Should the company buy or lease? $(1$ point$)2$