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Hi Guys, I wonder some body can help please. Calculate the interest rate implicit in the lease fair value = lease payments discounted at the implicit interest rate $35000 = $10000+(10000*a^3i) a^3i = 25000 / 10000 = 2.5 i = 9.7% how did arrive at 9.7% please?
It seems like using the annuity tables backwards.
3 year factor at 9% is 2.531 and at 10% is 2.487, so apportion in between
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