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hliz3 hliz3
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4 months ago
You are the manager of a sales division, and are considering leasing a fleet of cars for your staff. You can buy the cars for $300,000 or you can lease them for 8 years at $60,000 per year with payments due at end of each year. The company has a tax rate of 40.0% and a CCA rate of 10.0% on vehicles. If the company buys the cars and finances the purchase with a loan, they will pay 7.0% in interest. Assume that after the term of the lease is over, the salvage value of the cars will be zero. What is the NPV of the lease, based on half-year rule for CCA in the first year?

▸ -$23,194

▸ $59,610

▸ $217,196

▸ -$240,390
Textbook 
Corporate Finance

Corporate Finance


Edition: 5th
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mattloftergenermattloftergener
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4 months ago
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hliz3 Author
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4 months ago
I appreciate what you did here, answered it right Smiling Face with Open Mouth
kriggs62
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Yesterday
Just got PERFECT on my quiz
deathwing
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2 hours ago
This helped my grade so much Perfect
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