(4) Assume, you will receive rent payments over a time period of 88 years. For the...

(4) Assume, you will receive rent payments over a time period of 88 years. For the first 44 years, you will receive a rent of $444 at the end of each year. For the next 44 years thereafter you will receive $222 at the beginning of each year.
Assuming a discount rate of 4% calculate the net present value of this income stream. (a) Employing the equation for identical payments over a limited time period, show how you would alter this equation applied to this problem. Show the abstract formula.

(b) Now, calculate the NPV of the payments.

Expert Solution

Rahul Sunny answered 1 year ago

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