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1 months ago
 Cash value for lease HELP! What is the cash value of a lease requiring payments of ​$990 at the beginning of every three months three months for 77 ​years, if interest is 3 %3% compounded semi dash annually question mark semi-annually? Read 76 times 1 Reply Related Topics Replies wrote... Educator 1 months ago Edited: 1 months ago, bio_man  Quote from: savmoore (1 months ago) HELP! What is the cash value of a lease requiring payments of$990 at the beginning of every three months three months for 77 years, if interest is 3 %3% compounded semi dash annually question mark semi-annually? Use the formula for annuity.$$A=\frac{R\left[\left(1+i\right)^n-1\right]}{i}$$$$A$$ = future value amount → what we're looking for!$$R$$ = regular deposit/payment → 990$$i$$ = interest rate per compounding period → 0.03/2 = 0.015$$n$$ = total number of deposits → 4 (every three months suggests four periods per year) * 77 = 308$$A=\frac{990\left[\left(1+\frac{0.03}{2}\right)^{308}-1\right]}{\frac{0.03}{2}}=6 406 692.10$$I arrive to this number: \$6 406 692.10 (please double-check the calculation using your calculator!)
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