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The results of a sale - leaseback analysis indicate that the internal rate of return of the after - tax differential cash flows between the
The results of a saleleaseback analysis indicate that the internal rate of return of the aftertax differential cash flows between the holdanddonothing option and the saleleaseback option is percent. The owner could continue to own the property for ten more years and refinance it based on the following assumptions: a loantovalue of percent of the market value of $ an interest rate of percent, an amortization period of years, a tenyear term, payments per year, a loan cost of percent of the loan amount, and a corporate tax rate of percent.Which is the better alternative for the user as far as the aftertax cost of funds is concerned?
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