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Aa 324 AaBb code Ca BMCTD 0 AaBbCcDc AaBbcode Heading 1 Heading 2 Normal No Spacing 1. Assume that an airline has a financial decision

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Aa 324 AaBb code Ca BMCTD 0 AaBbCcDc AaBbcode Heading 1 Heading 2 Normal No Spacing 1. Assume that an airline has a financial decision to make between purchasing an aircraft for $20 million right now and leasing the aircraft at a cost of $2 million per annum for the next 20 years. Further, assume that the going rate of interest in the economy is 6%. a. Using the tables in Appendix 3B, discuss what financial decision the airline should make and why. b. Now assume that the interest rate has gone up to 10 percent. Answer the same question as above and explain in economic terms what the difference is between the two situations. ced States O Focus 30 F5 DIL F8 FO FY 9

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