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# Suppose you are studying two hardware lease proposals.

### Customer Question

Suppose you are studying two hardware lease proposals. Option 1 costs \$4,000, but requires that the entire amount be paid in advance. Option 2 costs \$5,000, but the payments can be made \$1,000 now and \$1,000 per year for the next four years. If you do an NPV analysis assuming a 14% discount rate, which proposal is less expensive? What happens if you use an 8% rate?Assume the following facts:
A project will cost \$45,000 to develop.
When the system becomes operational after a one-year development period, operational costs will be \$9,000 during each year of the system’s five-year useful life.
The system will produce benefits of \$30,000 in the first year of operation, and this figure will increase by a compound 10% each year.
What is the payback period for this project?Using the same facts as in Project 2, what is the ROI for this project?
Using the same facts as in Project 2, what is the NPV for this project? i want ans for the questions
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Customer: i think thats it
Submitted: 8 months ago.
Category: Homework
Expert:  Donna Kakonge replied 8 months ago.

Dear Customer,