Operating Leases Often Have Terms That Include

question 15

Multiple Choice

Operating leases often have terms that include

• A) maintenance of the equipment by the lessor.
• B) full amortization over the life of the lease.
• C) high penalties if the lease is cancelled.
• D) restrictions on how much the leased property can be used.
• E) much longer lease periods than for most financial leases.

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Definitions:

Federal Reserve System

The central banking system of the United States, responsible for monetary policy, regulating banks, and ensuring financial system stability.

Securities and Exchange Commission

A U.S. federal agency responsible for enforcing the laws governing the securities industry, and regulating the securities markets and investment companies.

Rate of Return

The advancement or decline in an investment's value over a predetermined interval, calculated as a percentage of the investment's initial expenditure.