A company can either buy certain land for outdoor storage, Ask an Expert

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A company can either buy certain land for outdoor storage of equipment or lease it on a 15-year lease.

The purchase price is $80,000. The annual rental is $5,000 payable at the start of each year.

In either case, the company must pay property taxes, assessments, and upkeep. It is estimated that the land will be needed for only 15 years and will be saleable for $100,000 at the end of the 15-year period.

What rate of return before income and property taxes will the company receive by buying the land instad of leasing it?

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M92659987

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