Security service for a corporation housed in a large office building/training complex can be provided in one of two ways. A service contract for 4 years will cost $35,000 per year, payable at the beginning of each year. If renewed for 4 more years, the cost will be $38,000 per year. A different service contract can be obtained at a lower cost of $ 35,534 per year, provided the corporation purchases certain equipment that will cost $ 109,902 and have a life of 8 years with salvage value of 2.5 % of the investment. Supplies costing $ 6,760 per year will also be needed for this option. At an interest rate of 16.1 % per year, the present worth of the second alternative is