Glossary of Terms

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Lease

A contract that includes an option for the lessee either to renew the lease at fair market rental value or to purchase the equipment for its fair market value at the end of the lease term. Fair market value exists when a willing buyer and a willing seller agree on rent or purchase price, respectively, assuming the equipment is in the condition required by the lease in which the option is granted. A lease may contain either or both options. (Courtesy www.elfaonline.org)

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