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A business can lease packaging equipment for $21,450 payable at the end of each year for 10 years, or it can purchase that equipment in
A business can lease packaging equipment for $21,450 payable at the end of each year for 10 years, or it can purchase that equipment in cash for $100,000. Or pay $500,000 at the end of 10 years. The economic life of the equipment is 10 years and the salvage value is expected to be zero. If the minimum required rate of return is 20%. What is the best alternative for the company?
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