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Your landscaping company can lease a truck for $ 7 , 8 0 0 a year ( paid at year - end ) for 6
Your landscaping company can lease a truck for $ a year paid at yearend for years. It can instead buy the truck for $ The truck will be valueless after years. The interest rate your company can earn on its funds is
a What is the present value of the cost of leasing?
Note: Do not round intermediate calculations. Round your answer to decimal places.
b Is it cheaper to buy or lease?
c What is the present value of the cost of leasing if the lease payments are an annuity due, so the first payment comes immediately?
Note: Do not round intermediate calculations. Round your answer to decimal places.
d Is it now cheaper to buy or lease?
tablea Present value of leaseb Is it cheaper to buy or lease?c Present value of leased Is it now cheaper to buy or lease?
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