Fill This Form To Receive Instant Help
Fill This Form To Receive Instant Help
Homework answers / question archive / If you pay rent of $1,200 due on the beginning of each year
If you pay rent of $1,200 due on the beginning of each year. If the annual interest rate is 8%, the present value of 5 year's rent is: Select one: O a. $8200 O b. $5174.55 O c. $7120 O d. $6170
| AS the rent is paid at the beginning of each year it is an 'annuity | |
| due', whose present value = 1200*1.08*(1.08^5-1)/(0.08*1.08^5) = | $ 5,174.55 |
| Answer: [b] $5,174.55 |
