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Noob Noob Corporation wants to acquire a $ 1 0 0 , 0 0 0 sweeper truck. Noob Noob has a 3 0 percent marginal

Noob Noob Corporation wants to acquire a $100,000 sweeper truck. Noob Noob has a 30 percent marginal tax rate. If owned, the truck would be depreciated on a straight-line basis to a book salvage value of $0. The actual cash salvage value is expected to be $30,000 at the end of 5 years. If the truck is purchased, Noob Noob could borrow the needed funds at an annual pretax interest rate of 10 percent. If purchased, Noob Noob will incur annual maintenance expenses of $3,000. These expenses would not be incurred if the truck is leased. The lease rate would be $27,000 per year, payable at the beginning of each year. Noob Noobs weighted after-tax cost of capital is 15 percent.
a. Compute the net advantage to leasing.
b. What decision should the company make based on NAL?

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