The overall gain from leasing is the sum of the leases value to the lessee and its

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The overall gain from leasing is the sum of the lease’s value to the lessee and its value to the lessor. Construct simple numerical examples showing how this gain is affected by

a. The rate of interest.

b. The choice of depreciation schedule.

c. The difference between the tax rates of the lessor and lessee.

d. The length of the lease.

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Principles of Corporate Finance

ISBN: 978-0072869460

7th edition

Authors: Richard A. Brealey, Stewart C. Myers

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Question Posted: Jun 09, 2011 06:01 AM

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The overall gain from leasing is the sum of the leases value to the lessee and its

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In general if INV is the value of the leased asset P the lease payment T c the corporate tax rate D t the depreciation at time t n the appropriate tim...View the full answer

Principles of Corporate Finance

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