General Studies · Lease and Hire Purchase
Which primary feature of a standard Operating Lease differentiates it from a Hire Purchase agreement?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1The periodic lease payments cover the full cost of the asset plus interest from day one.
- 2The lessee does not automatically obtain the ownership transfer of the asset at the end of the term.✓
- 3The lessee has an absolute right to cancel the contract at any time without penalty.
- 4The lease period is always shorter than the asset's economic life.
Correct answer
The lessee does not automatically obtain the ownership transfer of the asset at the end of the term.
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