The interest rate before taxes is 8 if they lease there


Learning University is tax-exempt. They need a new mini-bus for the campus. They can either buy or lease the bus. A new bus costs $123,000. It has a 6-year life with no salvage value. Depreciation is straight-line over 6 years. The interest rate (before taxes) is 8%. If they lease, there will be 6 prepaid lease payments. What is the maximum lease payment that LU will accept?

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Finance Basics: The interest rate before taxes is 8 if they lease there
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