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a. Assume Rafael can earn an 6 percent after-tax rate of return. Use Exhibit 3.1. Would he prefer $1,800 today or $2,700 in five years?

a.

Assume Rafael can earn an 6 percent after-tax rate of return. Use Exhibit 3.1. Would he prefer $1,800 today or $2,700 in five years?

b.

Jonah has the choice of paying Rita $6,000 today or $12,000 in 10 years. Assume Jonah can earn a 6 percent after-tax rate of return. Which should he choose?

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