te uestion 41 styet ered arked out of 20 Encore Mobile wants to lease production equipment from ABC Co. The payments are $200,000 per year for 5 years payable at the beginning of each year. Encore won't have to worry about annual maintenance costs if the equipment is leased, ABC Co. has agreed to service the equipment at no additional charge. As an alternative, the bank offered to lend Encore Mobile a loan of $950,000 to purchase the equipment. The loan would be paid in equal instalments at the end of each year for 5 years at an annual interest rate of 11%. At the end of 5 years, the equipment could be sold for an estimated $250,000. However, Encore Mobile would have to pay for annual maintenance fee of the machine estimated at $14,000 per year. Encore Mobile's cost of capital is 13% and the tax rate is 40%. The equipment belongs to a CCA class with a rate of 25% Required Should Encore Mobile lease or borrow to purchase the equipment? Show calculations to support your answer. Fing shion 7 A- B III op 22