Julie has just retired. Her companys retirement program has two options as to how retirement benefits can be received. Under the first option, Julie would receive a lump sum of $141,000 immediately as her full retirement benefit. Under the second option, she would receive $20,000 each year for eight years plus a lump-sum payment of $60,000 at the end of the eight-year period.

Click here to view Exhibit 13B-1 and Exhibit 13B-2, to determine the appropriate discount factor(s) using tables.

Required:
1a.	Calculate the present value for the following assuming that the money can be invested at 9%. (Round discount factor(s) to 3 decimal places.)

1b.

If you can invest money at a 9% return, which option would you prefer?

	First option
	Second option