A firm can lease a truck for 4 years at a cost of $46,000 annually. It can
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Question:
A firm can lease a truck for 4 years at a cost of $46,000 annually. It can instead buy a truck at a cost of $96,000, with annual maintenance expenses of $26,000. The truck will be sold at the end of 4 years for $36,000. |
a. | Calculate present value if the discount rate is 12%?(Do not round intermediate calculations. Round your answers to 2 decimal places.) |
Present Value | |
Buy | $ |
Lease |
b. | Which is the better option? |
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