Accession Number:

ADA151874

Title:

A Guide for Air Force Lease Versus Buy Decisions.

Descriptive Note:

Master's thesis,

Corporate Author:

AIR FORCE INST OF TECH WRIGHT-PATTERSON AFB OH SCHOOL OF ENGINEERING

Personal Author(s):

• Shedden,J. S.

Report Date:

1984-12-01

Pagination or Media Count:

125.0

Abstract:

This thesis reviewed prior Air Force cost-benefit analysis procedures for a lease versus buy decision. Specifically, it looked at the analysis supporting the Air Forces decision to lease 120 replacement aircraft for the CT-39 fleet. The analysis used an after-tax methodology to ensure a government perspective was taken. The CT-39 analysis was a form of pre-tax methodology that did not accurately capture all the lost revenue at the Treasury resulting from the depreciation deductions available with a lease. The results of the analysis indicate that an Air Forces perspective always results in a decision to lease but the government perspective results in a decision to buy at discount rates below 8 percent and a decision to lease at rates above 8 percent.

Descriptors:

• *AIR FORCE
• *ACQUISITION
• *COST ANALYSIS
• *AIR FORCE PROCUREMENT
• *LEASING
• DECISION MAKING
• MILITARY AIRCRAFT
• THESES
• AIR FORCE PLANNING

Subject Categories:

• Economics and Cost Analysis
• Logistics, Military Facilities and Supplies

Distribution Statement:

APPROVED FOR PUBLIC RELEASE