A financial lease has the following characteristics: Asset cost: $10,000; tax rate: 30%; CCA rate: 20%; after-tax cost of capital: 15%, lease term: 4 years, with $2,500 annual lease payments and tax shields in advance, and salvage and UCC tax shields in Year 4. Salvage is zero. The asset is part of a large pool. What important timing considerations should an analyst watch for in this analysis? What is its present value?

Please explain all parts of answer. Can you please explain why in previous solutions 5% is used for the after tax borrowing rate when the question gives an after tax borrowing rate of 15%.