Roger is conducting a biochemical experiment for the next 12

months. In the first month, the expenses are estimated to be

$10,000. As the experiment progresses, the expenses are expected

to increase by

2 percent each month. Roger plans to pay for the

experiment with a government

grant, which is received in four

monthly installments, starting a month after the experiment

completion date. Draw the cash flow diagram for this experiment.

Determine the amount of the monthly installment so that the

installments received are equal in value to the expenses incurred.

Annual nominal interest is 1

0 percent, compounded monthly.