In the Lease Versus Buy Decision, Leasing Is Often Preferable

question 3

Multiple Choice

In the lease versus buy decision, leasing is often preferable

• A) because, generally, no down payment is required, and there are no indirect interest costs.
• B) because lease obligations do not affect the firm's risk as seen by investors.
• C) because the lessee owns the property at the end of the least term.
• D) because the lessee may have greater flexibility in abandoning the project in which the leased property is used than if the lessee bought and owned the asset.
• E) because it has no effect on the firm's ability to borrow to make other investments.

---

Definitions:

Written Rules

Formal guidelines and regulations that are documented and used to govern the actions and behaviors of members within an organization or society.

Equity

Equity involves fairness and justice in treatment, access, and opportunities, aiming to recognize and address disparities among different groups.

Voice

Refers to employees' ability to express concerns, grievances, or suggestions within their place of work.

Bureaucratic Model

A framework that outlines the structured and hierarchical organization of public administration and large organizations, focusing on strict rules, procedures, and a clear chain of command.