Decision making among buy and lease

Reference no: EM1314218

Your landscaping company can lease a truck for $8000 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. If the interest rate your company can earn on its funds in 7%, is it cheaper to buy or lease?

Reference no: EM1314218

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