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problem: Stanley Corporation is considering a five (5) year, $6,000,000 bank loan to finance service equipment. The loan has an interest rate of 10% and is amortized over five (5) years with end-of-year pay. Stanley can also lease the equipment for an end-of-year pay of 1,790,000 dollar. Find the difference in the actual out of pocket cash flows between the two pays, that is, by how much (in thousands of dollars) does one pay exceed the other?

[A] $207.2

[B] $251

[C] $316.8

[D] $90

[E] $125.5

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  • Category:- Basic Finance
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