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1. Present Value Analysis. One of the applications of the PVC analysis and annualized costing...

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Finance

1. Present Value Analysis.

One of the applications of the PVC analysis and annualized costing is their use in making a lease or buy decision. Suppose that the purchase price of a heavy-duty printer is $19,000, with an annual maintenance cost of $250. And suppose the same printer can be leased for an annual cost of $2,000, with an annual maintenance cost of $350. Consider a fifteen-year term for the estimation and a 10 percent annual discount rate. Would it be more cost-efficient to lease or buy? Please present your calculation process below (20 points).

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