Question

5. You have moved into an apartment following graduation. Your apartment costs $750 per month, due...

5. You have moved into an apartment following graduation. Your apartment costs $750 per month, due at the beginning of each month. If you signed a 12-month rental agreement, what is the present value of the rent payments, assuming an annual interest rate of 10%? Show all work and/or numbers entered.

Business   Finance   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

Annuity means repeating payments every month at the beginning of each period. This can be considered similar to paying rent. An annuity is structured such as all the annuities paid are of the same amount and are made at equal intervals and are made at the beginning of each period.

So the Present value of Rent Payments is 5621.27$.

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Question 1: You found an apartment (A) for $1,000 per month, and they’re offering the first...
Question 1: You found an apartment (A) for $1,000 per month, and they’re offering the first month for free. You also found an apartment (B) on for $915 a month (with no first month for free!). The monthly interest rate is 1%. If you are planning on living there for 12 months, from a purely financial standpoint, 1. Which would you prefer? (Rent is due at the beginning of the month) 2. What if apartment A offered the last month...
Teresa rents her apartment for $642 per month, utilities not included. When she moved in, she...
Teresa rents her apartment for $642 per month, utilities not included. When she moved in, she paid a $730 security deposit using money from her savings account that was paying 4% interest. Her renter's insurance costs her $57 per year. What are Teresa's total annual costs of renting?
You are in the 25% tax bracket The apartment rents for 1100 per month Your monthly...
You are in the 25% tax bracket The apartment rents for 1100 per month Your monthly mortgage payments would be 2000 of which an aver of 1900 per month goes toward interest during the first year determine whether renting or buying is cheaper in terms of monthly payments during the first year assume you are itemizing deductions Is it cheaper to own or rent
You can choose between the following rent payments; you are the tenant in the apartment: a.        A...
You can choose between the following rent payments; you are the tenant in the apartment: a.        A lump sum cash payment of $12,500; b.        12 monthly payments of $1,100 each, the first occurring at the end of the month Which rental payment scheme would you choose if the interest rate was 5% APR with monthly compounding? What is the difference between the two options in today's dollars?
After graduation, you decide that you can pay $203.24 per month extra on your student loan...
After graduation, you decide that you can pay $203.24 per month extra on your student loan (standard monthly payment is 302.99), which has a balance of $50,000 and 20 years of monthly payments remaining. The annual interest rate on the loan is 4% How many years early will you be able to pay off the loan?
Joe got a job offer and he decided to rent his own apartment. He visited apartment...
Joe got a job offer and he decided to rent his own apartment. He visited apartment A and was very satisfied. He has already paid a deposit of $1,000 on a 12-month apartment lease, but he still has NOT paid the first month’s rent and signed any contract yet. The monthly rent for apartment A is $1,000, and the deposit is refundable at the end of twelve months upon completion of the lease contract. The next day, Joe finds a...
Joe got a job offer and he decided to rent his own apartment. He visited apartment...
Joe got a job offer and he decided to rent his own apartment. He visited apartment A and was very satisfied. He has already paid a deposit of $1,000 on a 12-month apartment lease, but he still has NOT paid the first month’s rent and signed any contract yet. The monthly rent for apartment A is $1,000, and the deposit is refundable at the end of twelve months upon completion of the lease contract. The next day, Joe finds a...
After graduation, you decide that you can pay $202.89 per month extra on your student loan...
After graduation, you decide that you can pay $202.89 per month extra on your student loan (standard monthly payment is 302.85), which has a balance of $60,000 and 20 years of monthly payments remaining. The annual interest rate on the loan is 4.4% How many years early will you be able to pay off the loan? please solve using excel
An apartment requires a 12-month lease. The terms of the lease require you to pay $1,000...
An apartment requires a 12-month lease. The terms of the lease require you to pay $1,000 upfront when you move in (the first month's $500 rent, plus a $500 security deposit). You then must pay $500 monthly per month, except at the end of the 12th month when you do not pay but receive your $500 security deposit back. What is the present value cost of this lease to you if your prevailing interest rate is the 1.0% per month?
You have just inherited an office building. You expect the annual rental income (net of maintenance...
You have just inherited an office building. You expect the annual rental income (net of maintenance and other cost) for the building to be $100,000 for the next year and to increase at 5% per year indefinitely. An expanding internet company offers to rent the building at a fixed annual rent for 5 years. After year 5, you could re-negotiate or rent the building to another tenant. What is the minimum acceptable fixed rental payments for this five-year agreement? Use...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT