Question

Annuity due.  Reginald is about to lease an apartment for 12 months. The landlord wants him to make the lease payments at the start of the month. The monthly payments are ​$1,600 per month. The landlord says he will allow Reg to prepay the rent for the entire lease with a discount. The​ one-time payment due at the beginning of the lease is ​$18,286. What is the implied monthly discount rate for the​ rent? If Reg is earning 0.7​% on his savings​ monthly, should he pay by month or make the​ one-time payment?

I have literally no idea how to do this. Everything I've tried has been incorrect. I would like to know how to do it with a formula, as my financial functions on my calculator are not easy to figure out.

Answer 1

NOS Cave data for the tablem anonly payments are $ 1,600 per Beginning of lase $18,286 Reg carryings 0.71 -) TO calculate amplied monthly descount ies we have 1600 +1600 18286 18386 = 1600 + 1600 10:6191 - Chapas) 10. 61A) = '. By checking to y to c. HS 24.5 By Cheersng At Y-0.64 RHS = 10.6141 Y = 0.7-4. RHS = 10.5828 :: Impaled monthly doscount 5 07. te must pay one payement are as $ 18, 206 - B