Pratt is ready to graduate and leave College Park. His future employer $($Ferndale Corporation$)$ offers the following four compensation packages from which Pratt may choose. Pratt will start working for Ferndale on January $1,$ year $1.$Benefit DescriptionSalaryHealth insuranceRestricted stockNQOSOption $1$$ $72,000$No coverageOption $2$$ $60,000$$ $5,4000$Option $3$$ $55,000$$ $5,4001,000$ sharesOption $4$$ $55,000$$ $5,400100$ optionsAssume that the restricted stock is $1,000$ shares that trade at $$5$ per share on the grant date $($January $1,$ year $1)$; shares are expected to be worth $$10$ per share on the vesting date at the end of year $1$; and no $83($b$)$ election is made. Assume that the NQOs $(100$ options$)$ each allows the employee to purchase $10$ shares at $$5$ exercise price. The stock trades at $$5,$per share on the grant date $($January $1,$ year $1)$ and is expected to be worth $$10$ per share on the vesting date at the end of year $1,$ and the options are exercised and sold at the end of the year. Also assume that Pratt spends on average $$3,600$ on health$-$related costs that will be covered by insurance if he had coverage or is an after$-$tax expense if he isn't covered by insurance $($treat this as a cash outflow$).$ Assume that Pratt's marginal tax rate is $35$ percent. $($Ignore FICA taxes and time value of money considerations$).$Required:a$.$ What is the after$-$tax value of each compensation package for year $1?$b$.$ If Pratt's sole consideration is maximizing after$-$tax value for year $1,$ which scheme should he select?