On the basis of an internal rate of return analysis

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A contractor is considering whether to buy or lease a new machine for her layout site work. Buying a new machine will cost $12,000 with a salvage value of #1200 after the machine's useful life of 8 years. On the other hand, leasing required an annual lease payment of $3000, which occurs at the start of each year. The MARR is 15%. On the basis of an internal rate of return analysis, which alternative should the contractor be advised to accept?

Please explain, and don't just use excel functions.

Reference no: EM13894174

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