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Consider a firm A that wishes to acquire an equipment. The equipment is expected to reduce costs by $ 5 3 0 0 per year.

Consider a firm A that wishes to acquire an equipment. The equipment is expected to reduce costs by $5300 per year. The equipment costs $23000 and has a useful life of 5 years. If the firm buys the equipment, they will depreciate it straight-line to zero over 5 years and dispose of it for nothing. They can lease it for 5 years with an annual lease payment of $7000. If the after-tax interest rate on secured debt issued by company A is 2% and tax rate is 10%, what is the Net Advantage to Leasing (NAL)?(keep two decimal places)
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