Novak Company has entered into two lease agreements. In each case the cash equivalent purchase price of the asset acquired is known and you wish to find the interest rate which applies to the lease payments.

Click here to view factor tables

$($a$)$

Lease A $-$ Lease A covers office equipment that can be purchased for $$607,415.$ Novak Company has, however, chosen to lease the equipment for $$114,000$ per year, payable at the end of each of the next $9$ years.

Calculate the implied interest rate for the lease payments. $($Round factor values to $5$ decimal places, e$.$g$.1\mathrm{.}25124$ and final answer to $0$ decimal places, e$.$g$.5\%.)$

Interest rate

$\%$