Redcorp plans to add a new fleet of cruise ships. The price of the fleet is $3 million. Redcorp expects that the residual value of the fleet after four years is zero. The marginal tax rate for Redcorp is 18%. The tax authority approves that the fleet can use the accelerated depreciation: Redcorp can depreciate 50% of the value of the fleet right after the purchase, and depreciate 20%, 20%, 5%, and 5% in the next four years. Assume that the cost of debt for Redcorp is 8.2%, and that the cost of equity is 10%. If Redcorp uses the fleet through a true tax lease for four years, instead of direct purchasing, the annual lease payments will be $1.4 million. The amount of the lease-equivalent loan is closest to:

a.

$1582000.00

b.

$537011.83

c.

$3267010.68

d.

$4018535.86