Jenkins Security has learned that a rival has offered to supply a parking garage with security for ten years for $50,000 up front and a further $20,000 per year. If Jenkins Security offers to provide security for eight years for an upfront cost of $70,000 and a separate yearly payment, what is the maximum that this yearly payment can be so that Jenkins' offer matches the equivalent annual annuity of their rival's offer? (Assume a cost of capital of 6%.)

1.$13,095

2.$14,095

3.$15,521

4.$20,484

A parking garage is offered security for ten years for $50,000 up front and a further $20,000 per year. What is the equivalent annual cost if the cost of capital is 6%?

1.$20,000

2.$24,239

3.$26,793

4.$30,386