Answer:
$12,727,043.35
Explanation:
The value of the lease payments today can be ascertained using the formula for the present value of an annuity due shown below:
PV=annual payments*(1-(1+r)^-n/r*(1+r)
annual payments=$1,050,000
r=interest rate=3.23%
n=number of annual payments in 15 years=15
PV=$1,050,000*(1-(1+3.23%)^-15/3.23%*(1+3.23%)
PV=$1,050,000*(1-0.62074194 )/3.23%*1.0323
PV=$1,050,000*0.37925806/ 3.23%*1.0323
PV=$12,727,043.35
