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2. A firm buys a machine for $40,000 and arranges to pay $4,500 at the end of each year. An annual effective interest rate to
2. A firm buys a machine for $40,000 and arranges to pay $4,500 at the end of each year. An annual effective interest rate to be applied for this purchasing contract is 8%. (a) [3 points) How many number of full yearly payments (including the balloon pay- ment on the last payment) is guaranteed? (Make sure to answer with an integer value.) (b) [3 points] Suppose the firm wants to pay an additional fractional payment made at the time of the last regular payment. Calculate the total amount to be paid on the last payment. (Keep in mind that this amount is greater than the yearly regular payment amount.) (c) [3 points) Suppose the firm wants to make the final smaller payment after a year from the last full yearly payment. Calculate this smaller amount of payment
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