(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.

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Expert Solution

Rahul Sunny answered 1 year ago

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