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Business, 30.10.2021 01:00 m4167281

Your grandfather has offered you a choice of one of the three following alternatives: $7,500 now; $2,200 a year for nine years; or $31,000 at the end of nine years. a-1. Assuming you could earn 10% annually, compute the present value of each alternative.
Percent Value
$7,500 $
$2,200 $
$31,000 $
a-2. What alternative should you choose?
i. $31,000 received at end of nine years
ii. $2,200 received each year for nine years
iii. $7,500 received now
b-1. If you could earn 11% annually, compute the present value of each alternative.
Present Value
$7,500 $
$2,200 $
$31,000 $
b-2. Which alternative would you choose?
i. $31,000 received at the end of nine years
ii. $2,200 received each year for nine years
iii. $7,500 received now

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Answers: 1

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