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Future Value Your mom is thinking of retiring. Her retirement plan will pay her either $250,000 immediately on retirement or $350,000 five years after the

Future Value

Your mom is thinking of retiring. Her retirement plan will pay her either $250,000 immediately on retirement or $350,000 five years after the date of her retirement.

a) Suppose that the interest rate is 3% per year. Which alternative should she choose?

b) Suppose that the interest rate is 8% per year. Which alternative should she choose?

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