3) Consider a 66-year lease for a $500,000 bottling machine, with a residual market value of $100,000

at the end of 66 years. If the risk-free interest rate is 5.9 % APR with monthly compounding, compute the monthly lease payment in a perfect market for the following leases:

a. A fair market value lease.

b. A $1.00 out lease.

c. A fixed price lease with an $59,000 final price.

a. A fair market value lease.

The present value of the lease payments is ______________ (Round to the nearest dollar.)

A fair market value lease would be ______________(Round to the nearest dollar.)

b. A $1.00 out lease. A $1.00 out lease would be

________________(Round to the nearest dollar.)

c. A fixed price lease with an $59,000 final price.

The present value of the lease payments is _________________(Round to the nearest dollar.)

A fixed price lease with an $59,000

final price would be _____________ (Round to the nearest dollar.)