Your firm is considering leasing a new robotic milling


Your firm is considering leasing a new robotic milling control system. The lease lasts for 4 years. The lease calls for 5 payments of $280,000 per year with the first payment occurring at lease inception. The system would cost $900,000 to buy and would be straight-line depreciated to a zero salvage value. The firm can borrow at 10%, and the corporate tax rate is 35%. What is the NPV of the lease (show all work). A. $(295,040) B. $(175,277) C. $125,789 D. $53,927 E. $(111,690)

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Financial Management: Your firm is considering leasing a new robotic milling
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