Toyota is considering an installment of a new machines to be used over the next four years. The company can either buy the machine for $650,000 today or lease it. The lease term would be four years and would require annual lease payments of $ 50,000, with lease payments made at the

beginning of each 12 - month period. Toyota would exercise an option to purchase the asset for $850,000 at the termination of the lease. If the discount rate is 15% and the tax rate is 40%, would you advise Toyota to buy or to lease the machine?