Asked by Pablo González on Jul 04, 2024

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The NPV that is calculated when deciding whether to lease an asset or to buy it is called the:

A) Open interest net present value.
B) Depreciation net present value.
C) Net advantage to leasing.
D) Profitability index.
E) Average accounting ratio for leasing.

Net Advantage

This term could be referring to various contexts and does not have a widely recognized specific financial definition without more context. NO.

Leasing

The process of renting an asset, such as equipment or property, for a specified period of time.

NPV

Net Present Value (NPV) is a method used to evaluate the profitability of an investment, calculating the difference between the present value of cash inflows and outflows.

  • Master the principle and computational strategy for the net advantage to leasing (NAL).
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MM
Marissa MyersJul 08, 2024
Final Answer :
C
Explanation :
The NPV calculated when deciding whether to lease an asset or to buy it is known as the Net Advantage to Leasing (NAL). This calculation helps in comparing the cost-effectiveness of leasing versus purchasing the asset.