Suppose that National Waferonics has before it a proposal for a four$-$year financial lease.

These flows reflect the cost of the machine, depreciation tax shields, and the after$-$tax lease payments. Ignore salvage value. Assume

the firm could borrow at $14\%$ and faces a $21\%$ marginal tax rate.

a$.$ What is the value of the equivalent loan? $($Do not round intermediate calculations. Round your answer to $2$ decimal places.$)$

Value of the equivalent loan

b$.$ What is the value of the lease? $($Do not round intermediate calculations. Round your answer to $2$ decimal places.$)$

Value of the lease

c$.$ Suppose the machine's NPV under normal financing is $-$$$3,900.$ Should National Waferonics invest?

should invest

should not invest