the requires rate of return is 17%

Purchase alternative: The company can purchase the cars, as in the past, and sell the cars after three years of use. Ten cars will be needed, which can be purchased at a discounted price of $29,000 each. If this alternative is accepted, the following costs will be incurred on the fleet as a whole: Annual cost of servicing, taxes, and licensing Repairs, first year Repairs, second year Repairs, third year $ 4,500 $ 2,400 $ 4,900 $ 6,900 At the end of three years, the fleet could be sold for one-half of the original purchase price. Lease alternative: The company can lease the cars under a three-year lease contract. The lease cost would be $64,000 per year (the first payment due at the end of Year 1). As part of this lease cost, the owner would provide all servicing and repairs, license the cars, and pay all the taxes. Riteway would be required to make a $12,000 security deposit at the beginning of the lease period, which would be refunded when the cars were returned to the owner at the end of the lease contract. ECHIBIT 148-1 Present Value of Star Trods 43 5% 8 8% 95 10% 11% 12% 13% 15% 16% 17X 18% 19% 20% 21 22 237 24% 256 0.962 0.952 0943 0.935 0.926 0917 0909 0901 0.893 0.885 0.8770870 0862 0.855 0347 0.840 0833 0.626 0.820 0.83 0.806 0800 2 0.925 0.907 0.890 0.873 0857 0842 0826 0.812 0797 0733 0769 0756 0743 0731 0.718 0.706 0.644 0683 0.672 0.661 0650 0640 3 0.889 0864 0.840 0.816 0.794 0.772 0751 0.731 07120693 0675 0658 0641 0.624 0609 0.593 0.579 0564 0551 0537 0.524 0512 4 0.855 0.823 0792 0763 0.735 0.708 0683 06590636 0.613 0.592 0.572 0552 0534 0516 0.499 0.482 0.467 0451 0.437 0421 0410 5 0.822 0784 0.747 0.713 0681 0650 0621 0.593 0567 0543 059 0497 0.476 0.456 0437 0.479 0.402 0.396 0.370 0.355 0.341 G 0790 0746 0705 0.666 0.630 0.596 0.564 0535 0.507 0.400 0.456 0432 0.450 0.390 0.370 0.352 0.335 0.319 0.303 0.299 0.275 0.262 7 0.750 0.711 0.665 0.623 0.583 0.547 0.53 0.482 0.452 0425 0.400 0.376 0354 0333 0.31 0.296 0.279 0.263 0.249 0235 0.222 0210 B 0731 0.677 0.627 0582 0.540 0.502 0.467 0.434 0404 0376 0351 0327 0305 0285 0.266 0.249 0.233 0.218 0.2040191 0.179 0168 9 0703 0.645 0592 0544 0.500 0.250 0.424 0.391 0.361 0333 0308 0.24 0.263 0243 0.225 0209 0.194 0.180 0167 0155 0.144 0.134 10 0676 0.654 0558 0508 0463 0.422 0.396 0.352 0322 0.295 02100247 0227 0208 0191 0176 0162 0.149 0.137 0126 0196 0107 11 0.650 0.585 0.527 0475 0.429 0388 0.350 0.317 0,237 0.201020 0.2150195 0178 0.162 0.148 0135 0123 0.112 0.103 0094 0.086 12 0.625 0.557 0.497 0.444 0.397 0.356 0.319 0.286 0257 0231 0200 0187 0,1600152 0.137 0124 0.112 0.1020.092 0.003 0.0760009 13 0.601 0.530 0.469 0.45 0.368 0.326 0.290 0.258 0229 0.204 0182 0100 0.145 0.130 0110 0:104 0,093 0.034 0.075 00580061 0055 0577 0.505 04420389 0340 0.29 0.263 0.232 0205 0.181 0160 0141 0125 0.111 0.099 0.088 0.078 0069 0.062 0.055 049 0044 15 0.556 0.481 0.417 0362 0.315 0275 0.239 0.209 0183 0.960 0340 0.123 0108 0.095 0.014 0.074 0.065 0,057 0.0510045 0.040 0.035 16 0.534 0.458 0.394 0.339 0292 0252 0210 0108 0103 0141 0.123 0907 0093 0.001 0071 0,062 0.054 0.047 0042 0.036 0032 0028 17 0.513 0430 0.371 0.30 0.270 0.231 0.198 0170 0146 0125 0108 0.003 0000 0000 0000 0.052 0.045 0.039 0.034 0.000 0.026 0023 10 0.494 0.416 0.250 0.290 0.250 0.212 0.1500153 0.130 11 0.035 0.00 0.00 0.00 0.051 0.014 0030 0.03200200024 0.021 008 19 0475 0.96 0.331 027 0.232 0194 01510139 014 000 or 0.07000600051 0013 0.037 0.031 0.027 0023 0.020 00170014 20 0.450 0.377 0.312 021 02150178 140 0124 004 0.007 0.073 0.061 0051 004 0.037 0.001 0.026 0022 0.0190016 0.05 0.012 21 0.419 0.39 0.294 0242 0.199 0164 005 0112 0000 0,072 0.064 0093 0044 0037 0.031 0.026 0,022 GO 0.015 000 do 6000 22 0422 0342 0.278 0220 0184 0.15001230101 0000 0.008 0.056 0046 0.038 0.032 0.026 0022 0.01 0.0150013 0.01 0.000 0.007 22 0.405 0.326 0.262 0.211 0170 01300112 0.091 074 0000 0.049 0040 0.633 0.027 0.022 0.018 0015 0012 0.010 0.00 0.007 0.006 0.390 0310 0.2470197 0150 0126 0102 0082 0.066 0.053 0.04 0.035 0.025 0.025 0.01 0.015 0.03 0.04 0.000 0.007 0006 0.005 25 0.375 0.295 0.233 0164 016 0.116 0092 0.674 005 0047 0030 0.030 0.024 0.020 0.0160.01300100009 0.007 0006 2005 2004 20 0301 0281 op20 0172 01350100 0084 0.066 005 0042001 0.026 0021 001 000 0.00 0.00 0.007 0.006 0.005 0.00 0.00 22 0347 0.20 0.207 0.161 0.125 0098 0.076 0060 0.00 0.007 0.029 0023 0.01 0.014 0.01 0.009 0.007 0.005 0.005 0004 0.003 0.002 20 0333 0255 0196 0150 0.116 0090 0.009 0.054 0.042 0.033 0.025 0.020 0016 0.012 0.000 0.00 0.00 0.005 0.004 0.003 0.002 0002 29 0.321 0.243 0,185 0.141 0.102 0.082 0063 0.048 0.032 0.025 0.022 0.017 0.014 0.011 0.008 0.006 0.005 0.004 0.003 0.002 0.002 0.002 30 0,300 02310174 0.01 0.099 0.075 0057 0.044 0.033 0.025 0.020 0015 0.012 0.009 0.007 0.005 0.004 0.003 0.003 0.002 0000 000 20 02080142 0.097 0.067 0.046 0032 0022 0.015 0.011 0.008 0.005 0.001 0.003 0.002 0.001 0.001 0.001 0.000 0.000 0.000 0.000 0.000 ECHIRIT SB-2 Prasant Value of an Annulty of 51 in rear - E 4907 4167 169 CS Periods 9 107. ITA MY 10% 13 2014 2 21 09520952 09001 0.935 0926 0917 6.9090901 OO 0346 0877 03700362 66 0347 0800 0833 0.826 0.820 GRD G805 0800 2 1850 1833 18 1783 1250 1736 1 161653 1547 1626 1805 158 1506 1547 1508 1509 1492 1474 2.775 2.722 2.673 1457 140 2.624 25712531 2487 244 2402 2.301 237220 2246 2210 211 2140 2196 207 2012 2011 151 1952 4 16:30 3566 3.45 3307 3.312 1200 3.170 3302 300 2944 204 205 279 270 2600 2.000 2.500 2.500 2.4 2.448 2.404 22 5 4452 4.3120 4212 4100 3.993 3890 3.791 366 3.605 334 335 321 3107 308 2007 2926 2864 2.800 72609 52125026 4 446 4.355 4231 um 3.990 3309 3784 1685 359 3.490 3450 3326 3245 33673092 3020 2951 7 6002 706 5582 1.200 5003 460 4712 4561 4.427 428 4800 4091622 3.812 3700 3605 150 341 3327124211 6.703 6.463 6.210 5743 SI55315 5106 4900 479 4.600 447 44207 4078 354 31537 3.726 367 3.421 3329 9 7475 7108 6.902 6515 6202 5.935 5799 537 5320 52 495 426.007 4451 430 43 4031 3905 276 1673 3566 145 10 8111 7722 7300 2024 670 5.418 6.145 5800 500 42652 00433 4659 4494 430 4054 19 3.799 1602 257 8.700 8.305 2687 7490 200 6.05 8496 6.202 5.30 5.675450 523 5020 406 465 446 41 4171 4035 1502 37616 12 9.385 800 3304 290 7536 2901 14 6.2 6.915.000 5421 5.19790490 40 4.600 4270 4127 20 1851 175 9.936 934 08535 7504 74 280370 6122 5.82 55.2 5.4910 471 4530 432 203 405 1970 105639.8999205 15 3.267706 76789126620 63026002 74 5229 Soon 404 462 420 439621124 15 11.10 103809712 0101 560001 7600 71 6.8 6.42 $12 1047 504 092 440 441 453 4001 150 10 165 10100 0100 047 3101 2018 7010 16.00.954 455 40 4530 435 4400187 1 2.300 12 1077 2701 9022 44 80027700 07286 0 0 549 5222 4900 4775 456 410409010 1200 1690 1005312 201 27027250 MO 6407 120 5.000 A 4000 40000 120 10 110 11150 100 0950 15657090 25660 SM 8070 450 4.00 442 423 40071 20 12.500 2.462 470 1050 909 5 7900 2400 4025 59 562 501 40 40 40 40 21 1009 12.11 1.764 106 10017 9292 11640 72 72 62500 5.704 977 404 422 0721 2 22 11.451 113602 001 10201 9443 1721 700 7170 0801 56.4105 4900 400 400 400 300 03 23 22:30 266044 5457 13400 12.00 120.17 9500 1881 1200 77 1976 24 90513497342200 6.494 601 50 541 5102 15.20 2.750 12.550 11401059797 47 470 507 41013 25 15.622 400 27 0106759023 NOT? 422 76133064646007576645751954948 721 4.5144 105 20 15.375 13.00011626 9261 20036.500 6200118 533 5400 52004956 020 4520 421 4151 22 16.33 1613211 1901 1903 1902 2175479 2409641501441365794925205 406 474 474 433041540 28 16.663 1 0 2005 2.307 0.002 70547441 6951 6934 6.12 3.010 5.5022 49204330 4520 435 4357 3992 29 56904 12.27 1158 10:15 2.31650 1022 YAO 6.98369564665020 5510 5229 475 470 45 43410114 30 17.292 512 13.5 2.400 112580274 9.222 1.004 3055 756 700 6.506617758295517 5.235 497 46 453 4300 403905 6.642 6233 5.871 540 5.250499747604544430747661 1791 1750 1501603321925 10.737 9779.951 1244 7634 7306 WCB MacBook Air Click here to view Exhibit 148-1 and Exhibit 148-2. to determine the appropriate discount factor(s) using tables. Required: 1. What is the net present value of the cash flows associated with the purchase alternative? 2. What is the net present value of the cash flows associated with the lease alternative? 3. Which alternative should the company accept