ABC Company has decided to buy a new machine for Rp. 50 million. Alternative 1: Leasing for 5 years with a lease payment of IDR 12 million and payment at the beginning of the year. The lessor company is DEF which bears maintenance costs of IDR 1,250,000 per year (at the beginning of the year). The 5-year-old machine has no residual value, and it is estimated that it will still sell for Rp. 8 million at the end of the 5th year. The DEF company determines a 10% profit before income tax at 40%.

Question

a. Determine the lease NPV b. Is the DEF company willing to sell the least?