Which of the Following Statements Is FALSE

question 39

Multiple Choice

Which of the following statements is FALSE?

• A)We can compare leasing to buying the asset using equivalent leverage by discounting the incremental cash flows of leasing versus buying using the after-tax borrowing rate.
• B)A non-tax lease is attractive if it offers a better interest rate than would be available with a loan.
• C)Evaluating a true tax lease is much more straightforward than evaluating a non-tax lease.
• D)To determine whether a non-tax lease offers a better rate,we discount the lease payments at the firm's pre-tax borrowing rate and compare it to the purchase price of the asset.

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Definitions:

Briefer Experiences

Short, often fleeting episodes or events that may have significant psychological impact despite their short duration.

States

Conditions or situations in varying modes, such as emotional states, physical states, or socio-political states.

Consistent

Marked by agreement or harmony in actions or qualities; showing steady conformity to character, profession, or belief.

Consciously Expressed

This refers to thoughts, feelings, or behaviors that are expressed with full awareness and intention.