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Your company wants to purchase a new network file server for its wide-area computer network. The server costs $125,000. It will be completely obsolete in

Your company wants to purchase a new network file server for its wide-area computer network. The server costs $125,000. It will be completely obsolete in three years. Your options are to borrow the money at 12 percent or to lease the machine. If you lease, the payment will be $35,000 per year, payable at the straight-line to zero over three years. The tax rate is 35 percent. Should you lease or buy?.

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