Question
UT Print is considering obtaining a 3D printer, and it can do so either with a lease or by purchase. The rent or lease
UT Print is considering obtaining a 3D printer, and it can do so either with a lease or by purchase. The rent or lease of such a machine involves a payment every year for its three-year useful life. The purchase option involves continuing maintenance and cost of purchase, but as an asset it has resale value of $15,000 at the end. The associated costs for both options are summarized as follows: Year 0 Lease -$5,000 -$5,000 -$5,000 -$5,000 Buy -$25,000 -$1,200 -$1,200 $13,800 1 2 3 Assume the MARR = 10%, should UT Print lease or buy a 3D printer? Which option is most economical according to the rate-of-return principle?
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Processes Systems and Information An Introduction to MIS
Authors: Earl McKinney, David M. Kroenke
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