Question: In the leasing discussion, James informs Nick that the contract could include a purchase option for the equipment at the end of the lease. Hendrix

In the leasing discussion, James informs Nick that the contract could include a purchase option for the equipment at the end of the lease. Hendrix Leasing offers three purchase options:

a. An option to purchase the equipment at the fair market value.

b. An option to purchase the equipment at a fixed price. The price will be negotiated before the lease is signed.

c. An option to purchase the equipment at a price of $125,000.

How would the inclusion of a purchase option affect the value of the lease?

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