INSTRUCTION:

1. CREATE Script narration for the solution for question #10.

ANSWER:

10.You end up leasing $18,073.08 after thedown payment and taxes for 4 years.The interest rate is 2.13% compounded monthly. The lease payment is monthly and due at the beginning of the month. How much has been paid, on the lease, over the 4-year period?

Round your answer to two decimal places. Do not enter the dollar sign. Sample input: 24562.23

(Hint:The down payment has already been taken off.So find the PMT value in the Simple Annuity Due formula using your leased amount. You can also use the TVM solver to find PMT. Then find the total value of these monthly payments over the length of the lease; i.e.,take your PMT and multiply by the total number of payments you make.)

SOLUTION:

10. Given: PV= $18,073.08 Tax= 2.13% Period= 4 years * 12 payments/year= 48 payments Solution: PV = PMT + (PMT)(1-(1+r) (-1) 18073.08 = PMT + (PMT)(1-(1+0.0213)-(48-1) 0.0213 PMT = $592.29 Total payment made in 4 years= PMT*48 = 529.29*48 = $25, 405.92