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Big Sky Hospital plans to obtain a new MRI that costs $ 1 . 5 million and has an estimated four - year useful life.

Big Sky Hospital plans to obtain a new MRI that costs $1.5 million and has an estimated four-year useful life. It can obtain a bank loan for the entire amount and buy the MRI or it can lease the equipmentAssume that the following facts apply to the decision: The MRI falls into the three-year class for tax depreciation, so the MACRS allowances are 0.33,0.45.0.15, and 0.07 in Years 1 through 4respectively Estimated maintenance expenses are $75,000 payable at the beginning of each year whether the MRI is leased or purchased -Big Sky's marginal tax rate is 40 percent Big Sky's cost of debt is 15 percent leased, the lease rental) payments would be $400,000 payable at the end of each of the next four years -The estimated residual and salvage) value is $250,000 What is the of the lease? Note: Format is if positiveif negative What is the IRR of the lease? NoteFormat is if positive% if negative

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