Question: Return to the case of the diagnostic scanner discussed in
Return to the case of the diagnostic scanner discussed in Problems 22.1 through 22.5. Suppose the entire $4.5 million purchase price of the scanner is borrowed. The rate on the loan is 8 percent, and the loan will be repaid in equal installments. Create a lease-versus buy analysis that explicitly incorporates the loan payments. Show that the NPV of leasing instead of buying is not changed from what it was in Problem 22.1. Why is this so?
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