Westover Mills is trying to decide whether to lease or buy some new equipment. The equipment costs $48,000, has a 3-year life, and will be worthless after the 3 years. The company has a tax rate of 34 percent, a cost of borrowed funds of 8.5 percent, and uses straight-line depreciation. The equipment can be leased for $16,800 a year. What is the amount of the annual depreciation tax shield? 1) $5,440 2) $5,712 3) $6,198 4) $6,250 5) $6,397