MGMT 211 5801 F2017 Business Finance-FINAL 7. In the lease venus buy decision, w
ID: 2799601 • Letter: M
Question
MGMT 211 5801 F2017 Business Finance-FINAL 7. In the lease venus buy decision, why is leasing office preferable? a Because it has no effect on the firm's ability to bomow to make other investments b. Becuse, gmeraly, mo down payment is required, and there are no indirect interest costs C Because lease obligations do not afflect the firm's risk as seen by investors d Because the lessee may have greater flexibility in ahundoning the project in which the ANS -property is wed ifthe lessor bought and outed the 8 Which evest would make it more likely that a compuny would choose to outstanding callable honds? a. The company's bosds are downgraded b. Market inticnest rates decline sharply c. The company's financial sinsation deterioraties sigficany d Inflation increases significandly 9. The Monmissey Company's bonds mature in 7 years, have a par value of $1.000, and make an ial cespn payment of SmThe market mort rate forthe bonis8.5%, what is the bond's price? $923 22 b. $946.30 c $969.96 d $994.21Explanation / Answer
7)
Purchasing decisions usually require large amount of intial payment towards down and regular interest payments. All these financial charges place heavy burden on profitability.
Hence, correct option is (B).
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