What is the present value of an operating lease that involves payments of $5,000 per year (the end of the year) for 10 years with no possibility of purchase at the end of the lease term.Assume that the firm is in the 40% marginal tax rate and the pre-tax cost of debt for the firm is 8%?
A) $38,986.43
B) $23,391.86
C) $20,130.24
D) $18,000.00
Correct Answer:
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