You work for a nuclear research laboratory that is contemplating leasing a diagnostic scanner (leasing is a very common practice with expensive, high-tech equipment). The scanner costs $6,500,000, and it would be depreciated straight-line to zero over four years. Because of radiation contamination, it actually will be completely valueless in four years. The tax rate is 25 percent and you can borrow at 7 percent before taxes. What would the lease payment have to be for both lessor and lessee to be indifferent about the lease? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)
You work for a nuclear research laboratory that is contemplating leasing a diagnostic scanner (leasing is a very common practice with expensive, high-tech equipment). The scanner costs $6,500,000, and it would be depreciated straight-line to zero over four years. Because of radiation contamination, it actually will be completely valueless in four years. The tax rate is 25 percent and you can borrow at 7 percent before taxes. What would the lease payment have to be for both lessor and lessee to be indifferent about the lease? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Transcribed Image Text:You work for a nuclear research laboratory that is contemplating leasing a diagnostic
scanner (leasing is a very common practice with expensive, high-tech equipment). The
scanner costs $6,500,000, and it would be depreciated straight-line to zero over four
years. Because of radiation contamination, it actually will be completely valueless in four
years. The tax rate is 25 percent and you can borrow at 7 percent before taxes. What
would the lease payment have to be for both lessor and lessee to be indifferent about
the lease? (Do not round intermediate calculations and round your answer to 2
decimal places, e.g., 32.16.)
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