You are the CEO of an SPV that is planning to build a suspension bridge. You are evaluating the

debt service payment for the fourth year and decided to create a debt service reserve account to

make this payment.

$$ The base amount of the fourth year service debt in today$$s USD is $2$ million $($in constant

dollars, not including the cover ratio$).$

$$ The expected annual average inflation rate for the following four years is $5\%.$

$$ You found a great deal: market interest rate is $8\%$ compounded quarterly $($for the debt

service reserve account$).$

Calculate the minimum quarterly installment to be deposited in the debt service reserve account

for the following four years to satisfy a cover ratio of $1\mathrm{.}4.$