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12 (4 points) Sam is buying a business. She has 2 offers to consider. Current simple interest rates are 6%. Offer 1: $1,000,000 payable today
12 (4 points) Sam is buying a business. She has 2 offers to consider. Current simple interest rates are 6%. Offer 1: $1,000,000 payable today and $1,200,000 payable in 2 years. Offer 2: $1,000,000 payable today $1,250,000 payable in 3 years. a) What is the current economic value of both offers? Round your answer to the nearest dollar. (2 points) Offer 1: Offer 2: Z N b) Which offer Should Sam choose? (1 point) c) What is the economic advantage of that offer? (1 point)
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