Question: A machine that will be worthless after five years costs $3.2 million. This machine can be leased for $760,000 per year for five years. Assume

A machine that will be worthless after five years costs $3.2 million. This machine can be leased for $760,000 per year for five years. Assume the machine, if purchased, would be depreciated straight-line to zero over its 5-year life. What is the net advantage to leasing this machine for a company that will pay no taxes over the lease period and has a pretax cost of borrowing of eight percent? $282,706 $165,540 $121,409 $212,809 $228,315

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