Return to the case of the diagnostic scanner used in Problems 1 through 6. Suppose the entire $4,800,000 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 1. Why is this so? 

Data from problem 1

Assume that the tax rate is 21 percent. You can borrow at 8 percent before taxes. Should you lease or buy?