The Bentley Azure can be leased for four years for $0 down and 48 monthly payments of $4,000 (due at the beginning of each month).Today is the day that the first payment is due.If,instead,you save the payments in a bank account at the nominal annual rate of 7.5%,then how much money will you have at the end of the fourth year? (Round answer to the nearest whole dollar)
A) $224,498
B) $223,103
C) $221,984
D) $222,768
E) $223,326

Question

Quizplus · Accepted Answer

FV = PMT × 11ea7fdb_fc18_2f67_a768_3726295565da_TB2902_11 × 11ea7fdb_fc18_2f68_a768_85c924476257_TB2902_11 FV = 4,000 × 11ea7fdb_fc18_2f69_a768_9d4f249429e1_TB2902_11 × 11ea7fdb_fc18_2f6a_a768_ed5073c7f854_TB2902_11 = $224,497.85
Using a financial calculator:
N = 18, I/Y = 5, PV = 0, PMT = -2,000, cpt FV = 223,103.46
223,103.46 × 1.00625 = $224,497.85

The Bentley Azure Can Be Leased for Four Years for $0