B 31)(LO3 ment to MTBA plc. MTBA requests that the lease be for 9 years. The that the residual value at least ) Cardinal Lid. is negotiating to lease a piece of equip- equipment has a useful life of 10 years. Cardinal wants a guarantee of the equipment at the end of the lease is 00. MTBA agrees to guarantee a residual value of this though it expects the residual value of the equipment to be 00 at the end of the lease term. If the fair value of the equip- ease commencement is 70,000, what would be the amount e annual rental payments Cardinal demands of MTBA, assuming payment will be made at the beginning of each year and Cardinal 5,0 only 2,5 ent at l of o earn a rate of return on the lease of 8%