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E55 o ue Tale OI return for the bulldozer using the Analysis 7-76 If alte rep best financing plan? 7-72 A diesel generator for electrical
E55 o ue Tale OI return for the bulldozer using the Analysis 7-76 If alte rep best financing plan? 7-72 A diesel generator for electrical power can be A purchased by a remote community for $350,000 A and used for 10 years, when its salvage value is $50,000. Alternatively, it can be leased for $42,500 a year. (Remember that lease payments occur at the start of the year.) The community's interest and ase 5% Fi U ID rate is 7%. Us (a) What is the interest rate for buying versus r leasing? Which is the better choice? (b) The community will spend $80,000 less each year for fuel and maintenance, than it currently spends generator? What is the rate of return for the 7-77 Je he on buying power. Should it obtain the Fi generator using the best financing plan? G
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