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Mike is considering renting a new apartment for a total of 4 years. Rent will be paid monthly starting at $2,460 with the first payment

Mike is considering renting a new apartment for a total of 4 years. Rent will be paid monthly starting at $2,460 with the first payment in one months' time. The rental contract states that the rent will increase each month at the inflation rate of 2% p.a. compounded annually. If the appropriate discount rate is 6.25% p.a. compounded annually, what is the total cost to Mike of this rental agreement in current terms?

$104,348.63

$106,750.57

$108,579.55

$103,248.19

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