2. Nico is a 64 year old teacher who teaches economics at River Plate High School, where the retirement age is set at 65. Nico's annual earning is $9, 000. (a) Recently, Nico has been thinking about retirement. If he retires next year, he would receive retirement payment from the school of $20, 000 each year from next year until forever (Assume Nico will live forever, and stay being retired. I know I know, it is a bad assumption). If he retires now, he will only receive payment of $19, 000 each year since he hasn't reach 65. Standing at present, if you were Nico, given the interest rate of 10%, would you prefer to retire now or next year? (Assume the cost are the same in each cases.) (b) Assume that now a year has pass. Nico is 65 now. For some reason, he decide to teach forever. He stays at River Plate High school still with annual earning $9, 000. Now, he got a new offer from Boca Junior High, where they offer him a $1, 000 raise in annual earnings. However, if he decides to teach at Boca, he will have to move to the school district of Boca where annual expense is $6, 000 instead of $5, 000 each year at River plate. If you were Nico, would you change your job? (Assume the interest rate is still 10%) (c) Related to 2(b). What if the interest rate is 5% now, do you think he would change his decision? ((1) How do you think the interest rate plays a role here? Please explain