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12. A potential customer proposes to make a large pruchase from you. They offer the following two methods of payment: (1) they offer to pay

12. A potential customer proposes to make a large pruchase from you. They offer the following two methods of payment: (1) they offer to pay $100,000 today; or (2) they will pay $25,000 at the end of each of the next 5 years. Current market interest rates are 9%. a. What is the PV of the first option? b. What is the PV of the second option? c. Which one would you choose and why image text in transcribed

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