Rearden Metal needs to order a new blast furnace that will be delivered in one year. The $1,000,000 price for the blast furnace is due in one year when the new furnace is installed. The blast furnace manufacturer offers Rearden Metal a discount of $50,000 if they pay for the furnace now.

1. If the interest rate is 4% (applicable for both borrowing and investment), what Rearden Metal should do?
2. Which decision Rearden must take If Rearden does not have cash currently (but expects to have it in the future). Explain, provide computations supporting your answer.