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I Chart 2 Jennings Company faces the following two options [ Buy or Lease ) for the manufacturing equipment. In order to exercise the better
I Chart 2 Jennings Company faces the following two options [ Buy or Lease ) for the manufacturing equipment. In order to exercise the better option, the engineering manager in the Jennings use 4 different methods to make decision under ROI of 8%. Buy 10,000 6,000 Lease 0 Down payment Annual Mortgage Annual lease Salvage [after 4 year] 4,000 0 25,000 Refer to Chart 2. The internal rate of return for moving from leasing option to buying option is O a. 10.55% O b. 10.94% O c. 11.24% O d. 11.58%
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