Your Firm Needs to Invest in a New Delivery Truck

question 38

Multiple Choice

Your firm needs to invest in a new delivery truck. The life expectancy of the delivery truck is five years. You can purchase a new delivery truck for an upfront cost of $240,000, or you can lease a truck from the manufacturer for five years for a monthly lease payment of $4800 (paid at the end of each month) . Your firm can borrow at 7.80% APR with quarterly compounding. The present value (PV) of the lease payments for the delivery truck is closest to ________.

• A) $190,506
• B) $238,132
• C) $285,758
• D) $333,385

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Definitions:

Leadership

The act of guiding and directing a group towards achieving a common goal, through influence and motivation.

Role

A set of expectations or duties assigned to an individual in a social situation or in an organizational setting.

Servant Leadership

A leadership philosophy that focuses on prioritizing the needs of team members, customers, and the community before considering self-interest, emphasizing service to others.

Team Performance

A measure of how effectively a group achieves its goals and objectives.