Te company would like to buy a machine for 8 mil usd , Ask an Expert

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The company would like to buy a machine for 8 mil USD . Machine would be depreciated for 3 years using straight line method. Company has following options.

Loan; maturity 3 years interest 5.841%% p.m equal anuuity yearly payment.

Leasing; leasing coeficient 1.2 advanced payment 35% maturity 3 years annual payment corporate tax is 20% .

a) Modify the monthly interest rate to yearly based interest rate.

b) Which instrument on the marker would be cheaper for company?

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M93060095

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