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The Galactic Empire Inc. must purchase $5,000,000 worth of heavyblaster rifles. The Galactic Empire is looking into either leasingthe weapons or purchasing them. The Galactic Empire has a zero taxrate due to tax loss carry-forwards. The Galactic Empire isconsidering a 6-year bank loan to finance the weapons. The loan hasan interest rate of 9% and would be amortized over 6 years, with 6end-of-year payments. The Galactic Empire can also lease theweapons for 6 end-of-year payments each for $1,192,000 each. Howmuch larger or smaller is the bank loan payment compared to thelease payment? (Subtract the loan payment from the leasepayment).
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