Use the Table for the Question(s)below

question 31

Multiple Choice

Use the table for the question(s) below.
Your firm is contemplating leasing some new equipment.The cash flows of either buying or leasing the equipment are shown in the table above.
-If your firm's borrowing cost is 10% and the tax rate is 40%,what is the amount of the lease-equivalent loan for the new equipment?

• A)$178,937
• B)$158,169
• C)$41,831
• D)$27,014
• E)$172,986

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