Abstract
Existing approaches to the financial lease versus purchase decision assume, at least implicitly at the moment of the decision, that purchase entails ownership of the leasable asset over its entire remaining economic life. At any subsequent moment in time, however, if a firm already owns the leasable asset, it can retain long-term use of the asset by deciding to either retain ownership or enter into a sale and leaseback agreement. The purpose of this chapter is to detail the derivation of an innovative, yet intuitive, theoretical approach to analyze a firm's financial lease versus purchase decision in asset markets conducive to future sales and leaseback of owned assets.
Original language | American English |
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Journal | Research in Finance |
Volume | 27 |
DOIs | |
State | Published - Jan 1 2011 |
Disciplines
- Accounting
- Business
Keywords
- Finances
- Financial lease
- Leasing
- Purchasing