c$)$ A company is considering the lease of equipment which has a purchese price of Tsh $350,000.$ The equipment has an estimated econorric life of $5$ years. The wilten doun decredadtion $125\frac{\%}{1}$ allowed. The leases Rental per car are Tsh $120,000,000$ assume the corporate texis $50\%f$ to borrowing rat: interest rat $16\%,0\mathrm{.}16(1-0\mathrm{.}5)$

Required: interest rat $0\mathrm{.}16(1-05)=0,08$ Show if it is advantageous for the company to lease the equipment. Ignore tax shield ondeprecoditon ator five years.

$6/7/202211$:$08$:$58$ PM

Adv of Leverage Leasee