Question: What would the lease payment have to be for both the lessor and the lessee to be indifferent about the lease? You work for a

What would the lease payment have to be for both the lessor and the lessee to be indifferent about the lease?

You work for a nuclear research laboratory that is contemplating leasing a diagnostic scanner (leasing is a common practice with expensive, high-tech equipment). The scanner costs $5,200,000, and it would be depreciated straight-line to zero over four years. Because of radiation contamination, it will actually be completely valueless in four years. You can lease it for $1,525,000 per year for four years.

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