Your firm is considering leasing a new laser light. The lease lasts for 3 years. The lease calls for 4 payments of $12,000 per year with the first payment occurring immediately. The computer would cost $33,000 to buy and would be straight-line depreciated to a zero salvage value over 3 years. The actual salvage value is negligible because of technological obsolescence. The firm can borrow at a rate of 10%. The corporate tax rate is 40%.

What is the after-tax cash flow from leasing relative to the after-tax cash flow from purchasing in years 1-3?

Group of answer choices

$-11,750

$-11,600

None of these

$-11,650

$-32,775