You Are the Manager of a Sales Division

question 69

Multiple Choice

You are the manager of a sales division.You are considering leasing a fleet of cars for your staff.You can buy the cars for $300,000 or you can lease them for eight years at $60,000 per year.The company faces a tax rate of 40% and a CCA rate of 10% on vehicles.If the company buys the cars and finances the purchase with a loan, they will pay 7% after-tax 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?

• A)$9,340
• B)$16,754
• C)$29,521
• D)34,195

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Definitions:

Empirically Tested

Involves methodologies that rely on observation and experimentation to validate theories or hypotheses.

Middle-Range Theories

Middle-range theories in nursing are conceptual frameworks that offer explanations for specific phenomena, bridging the gap between grand theories and nursing practice.

Complex Situations

Situations that are comprised of multiple interconnected elements and variables, which are difficult to understand and manage.

Building Blocks

Fundamental components or elements that serve as the foundation for constructing, understanding, or developing something.