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Greencore Corporation is considering leasing a new equipment. The lease lasts for 8 years. The lease...

Greencore Corporation is considering leasing a new equipment. The lease lasts for 8 years. The lease calls for 8 payments of $225,000 per year with the first payment occurring immediately. The equipment would cost $1,480,000 to buy and would be straight-line depreciated to a zero salvage value over 8 years. The firm can borrow at a rate of 6%. The corporate tax rate is 25%. The actual pre-tax salvage value is $36,000. What would the NPV of the lease relative to the purchase be?

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