(6) Fun City will enter into a public-private partnership agreement (PPP, or P3) with a consortium of private investors represented by a hedge fund. As part of the agreement, the city will rent a 10,250-square-foot office building to house certain city departments. The lease payment schedule follows. Compute the net interest cost (NIC) and "true interest cost" (TIC) for the lease. (30 points) Payment Number Payment Date 01/01/93 01/01/94 01/01/95 01/01/96 01/01/97 01/01/98 01/01/99 01/01/00 01/01/01 01/01/02 01/01/03 01/01/04 01/01/05 01/01/06 01/01/07 16. 01/01/08 01/01/09 18. 01/01/10 TOTALS Total Payment Interest Component $10,000.00 $0.00 40,651.20 37,651.20 43,474.71 37,474.71 47,121.73 37,121.73 50,533.43 36,533.43 53,709.81 35,709.81 58,650.87 34,650.87 63,238.95 33,238.95 67,474.05 31,474.05 69,356.17 29,356.17 71,002.97 27,002.97 72,414.45 24,414.45 75,590.61 21,590.61 78,413.79 18,413.79 80,883.99 14,883.99 83,001.21 11,001.21 82,765.45 6,765.45 41,294.37 2,294.37 $1,079,577.76 $429,577.76 Total Principal Beginning Principal $10,000.00 $650,000.00 3,000.00 640,000.00 6,000.00 637,000.00 10,000.00 631,000.00 14,000.00 621,000.00 18,000.00 607,000.00 24,000.00 589,000.00 30,000.00 565,000.00 36,000.00 535,000.00 40,000.00 499,000.00 44,000.00 459,000.00 48,000.00 415,000.00 54,000.00 367,000.00 60,000.00 313,000.00 66,000.00 253,000.00 72,000.00 187,000.00 76,000.00 115,000.00 39,000.00 39,000.00 $650,000.00 17