Assume an annual discount rate (interest rate) of 10% and annual compounding in each of the following
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Question:
Assume an annual discount rate (interest rate) of 10% and annual compounding in each of the following scenarios:
(2) Ace leases a machine and agrees to pay $10,000 at the end of each year for 10 years. How much did the machine cost?
(3) Ace buys a machine and agrees to make ten (10) annual payments of $10,000, with the first annual payment being made today. How much did the machine cost?
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