The Point Where a Lessee Is Indifferent Between Leasing and Buying

Multiple Choice

The point where a lessee is indifferent between leasing and buying is the point where the:

A) Total cash outlays for lease payments are equivalent to the purchase cost of the asset.
B) Net present value from leasing is equal to zero.
C) Total cash flows minus the depreciation tax shield are equal to zero.
D) Tax savings from leasing equal the tax savings from buying.
E) Net present value from leasing is positive.