New Pharm Technology is a rapidly growing biotech company that has a required rate of return of 14%. It plans to build a new facility in Santa Clara Country. The building will take two years to complete. The building contractor offered New Pharm a choice of three payment plans, as follows:

Payment Plan 1 Payment of $175,000 at the time of signing the contract and $4,700,000 at the completion of the building. The building would be 100% complete at the very end of the second year.

Payment Plan 2 Payment of $1,625,000 at the time of signing the contract and $1,625,00 at the end of each of the two succeeding years.

Payment Plan 3 Payment of $325,000 at the time of signing the contract and $1,500,000 at the end of each of the three succeeding years.

Required Your boss, the CEO of New Pharm Technology, wants to know what the best option to choose would be based on the three above. Choose the appropriate method and show calculations.