An obligation can be settled by making a payment of $6,000 now and a final payment of $2,500 in two years (Alternative 1). Alternatively, the obligation can be settled by payments of $700 at the end of every six months for nine years (Alternative 2). Interest is 12% compounded semi-annually. Compute the present value of each alternative and determine the preferred alternative according to the discounted cash flow criterion. The present value of Alternative 1 is $ (Round to the nearest dollar as needed. Round all intermediate values to six decimal places as needed.)