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In an equipment acquisition proposal, MKBK Enterprises has worked out to deal on the interest rate with the vendor. The equipment is being financed for 10 years with monthly payments. The deal with the vendor worked out is as below. The interest rate is 1% per month for the first 30 payments and for the rest of the payments the interest rate would be ¾ % per month. The equipment cost $1,000,000.
a. Determine the monthly payment for the first 30 months.
b. Determine the amount of 31-st monthly payment.
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