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- Publisher
- Emerald Publishing
- Copyright
- Copyright © Emerald Group Publishing Limited
- ISSN
- 0002-1466
- DOI
- 10.1108/00214830180001124
- Publisher site
- See Article on Publisher Site
Abstract
A survey of textbooks from agricultural economics and finance reveals agreement among the texts that the lease versus purchase decision should be based on a comparison of the present values of the aftertax cash flows associated with leasing versus purchasing. However, the texts disagree about the discount factor and cash flows that should be used in the analysis. Most agricultural economics texts recommend discounting by the cost of capital while most finance texts recommend discounting by the aftertax cost of borrowed funds. Texts from both agricultural economics and finance disagree about the timing of lease payment tax shields.
Journal
Agricultural Finance Review – Emerald Publishing
Published: Nov 1, 2001