Ritchie Coliseum is looking to acquire new treadmills and stair-steppers. They can buy them from Life Fitness for $62,500 and assume the shelf-life is 8 years. This option will also come with $4,000 of upkeep costs per year. The other option they have is to rent the treadmills and stair-steppers that come with a warranty for $15,000 per year for the same time period of 8 years. The cost of capital is 8.24%. Should they buy or rent and why?

Group of answer choices

RENT, because the NPV is -85,279 which is higher than the buy option.

BUY, because the NPV is -$85,240 which is higher than the rent option.

BUY, because the NPV is -$85,279 which is higher than the rent option.

BUY, because the NPV is -85,240 which is higher than the rent option..

RENT, because the NPV is -$85,240 which is higher than the buy option.