A Tenant Wants to Lease a Building for $48,000 Per

Multiple Choice

A tenant wants to lease a building for $48,000 per year. She signs a five-year rental agreement that
states that she will pay $24,000 every six months for the next five years. Which of the following is
the timeline for her rental payments, assuming she makes the first payment immediately?

A) $$\begin{array} { | l | l | l | l | l | l | l | l | l | l | l | l | } \hline \begin{array} { l } \text { Date } \\\text { (years) }\end{array} & 0 & 1 / 2 & 1 & 11 / 2 & 2 & 21 / 2 & 3 & 31 / 2 & 4 & 41 / 2 & 5 \\\hline \begin{array} { l } \text { Cash Flows } \\\text { (thousands) }\end{array} & - \$ 24 & - \$ 24 & - \$ 24 & - \$ 24 & - \$ 24 & - \$ 24 & - \$ 24 & - \$ 24 & - \$ 24 & - \$ 24 & 0 \\\hline\end{array}$$
B) $$\begin{array} { | l | l | l | l | l | l | l | } \hline \begin{array} { l } \text { Date } \\\text { (years) }\end{array} & 0 & 1 & 2 & 3 & 4 & 5 \\\hline \begin{array} { l } \text { Cash Flows } \\\text { (thousands) }\end{array} & - \$ 48 & - \$ 48 & - \$ 48 & - \$ 48 & - \$ 48 & - \$ 48 \\\hline\end{array}$$
C) $$\begin{array} { | l | l | l | l | l | l | l | } \hline \begin{array} { l } \text { Date } \\\text { (years) }\end{array} & 0 & 1 & 2 & 3 & 4 & 5 \\\hline \begin{array} { l } \text { Cash Flows } \\\text { (thousands) }\end{array} & \$ 48 & \$ 48 & \$ 48 & \$ 48 & \$ 48 & \$ 48 \\\hline\end{array}$$
D) $$\begin{array} { | l | l | l | l | l | l | l | l | l | l | l | l | } \hline \begin{array} { l } \text { Date } \\\text { (years) }\end{array} & 0 & 1 & 2 & 3 & 4 & 5 & 6 & 31 / 2 & 4 & 41 / 2 & 5 \\\hline \begin{array} { l } \text { Cash Flows } \\\text { (thousands) }\end{array} & \$ 24 & \$ 24 & \$ 24 & \$ 24 & \$ 24 & \$ 24 & \$ 24 & \$ 24 & \$ 24 & \$ 24 & \$ 24 \\\hline\end{array}$$