Annuity due your landscaping company can least a truck for, Ask an Expert

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Annuity Due. Your landscaping company can least a truck for $8,000 a year (paid at year-end) for 6 years. It can instead buy the truck for $40,000. The truck will be valueless after 6 years. The interest reate your company can earn on its funds is 7%.

a. what is the cost of leasing?

b. is it chapter to buy or lease?

c. what if the lease payments are an annuity due, so the first payment comes immediately? is it cheaper to buy or lease?

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M91546813

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