Question
Spinning Wheels Co. is considering renting a new bike shop. The landlord has offered a number of alternatives for paying the rent. The company's desired
Spinning Wheels Co. is considering renting a new bike shop. The landlord has offered a number of alternatives for paying the rent. The company's desired rate of return is 10%.The landlord offered a 3-year lease with the rent payments as follows: $8,000 at the end of the first year, $12,000 at the end of the second year, and $14,000 at the end of the third year. Using a spreadsheet or financial calculator, calculate the present value of the rent payments over the life of the lease. The present value of the rent payments over the life of the lease is:
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