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Tessa wants to buy or lease a printing machine. The printing machine costs $7000 right now and it would last only 10 years. 10 years
Tessa wants to buy or lease a printing machine. The printing machine costs $7000 right now and it would last only 10 years. 10 years later it can be sold at a scrap value of $5000. The printing machine will need annual maintenance costing $1000 p.a. for smooth running. However, the cost of leasing the printing machine will be $2500 p.a. Tessa will not need to pay for any maintenance during the leasing period. given that the current cost of capital is 15% p.a. Help Tessa to decide on which option will be best for her.
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