How Is a Guaranteed Residual Value Accounted for When Computing

question 5

Multiple Choice

How is a guaranteed residual value accounted for when computing minimum lease payments?

• A) The present value of the guaranteed residual value is added in to determine the minimum lease payments.
• B) It is ignored.
• C) The future value of the guaranteed residual value is added in to determine the minimum lease payments.
• D) The excess of guaranteed residual value over estimated residual value is added in to determine the minimum lease payments.

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Definitions:

Cathode

The electrode from which electrons exit a device or where positive ions enter.

Voltaic Pile

A group of voltaic cells connected together to form a battery.

Alessandro Volta

An Italian physicist known for inventing the battery in the 1800s, leading to the development of the first source of continuous electrical current.

Electricity

A form of energy resulting from the existence of charged particles, such as electrons or protons, either statically as an accumulation of charge or dynamically as a current.