A rental agreement requires the payment of $1000 at the beginning of each month.
a) What single payment at the beginning of the rental year should the landlord accept instead of monthly payments if money is worth 8% compounded monthly?
b) Show that the landlord will be equally well off at the end of the year under either payment arrangement if rental payments are invested at 8% compounded monthly.

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The Answer of A rental agreement requires the payment of $1000 at the beginning of each month.
a) What single payment at the beginning of the rental year should the landlord accept instead of monthly payments if money is worth 8% compounded monthly?
b) Show that the landlord will be equally well off at the end of the year under either payment arrangement if rental payments are invested at 8% compounded monthly.

A Rental Agreement Requires the Payment of $1000 at the Beginning