Skylane Airways is negotiating with an airframe outfitter in planning the interior finishings of an eight-passenger turboprop that Skylane Airways expects to acquire and place in charter service. The airplane will be completed and ready for service four years hence. If Skylane pays for the airplane upon completion (Payment Plan A), it will cost \(\$ 1,895,000\). However, two alternative payment plans are available. Plan B would require an immediate payment of \(\$ 1,422,750\). Plan C would require four annual payments of \(\$ 400,250\), the first of which would be made one year hence. In evaluating the three alternatives, the management of Skylane has decided to assume an interest rate of \(9 \%\).

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Calculate the present value of each payment and indicate which plan Skylane should follow.