Sherritt's five$-$year borrowing rate is $43\mathrm{.}111\%$ and the Government of$$ Canada's is $1\mathrm{.}37\%.$ Both interest rate quotes are effective annual rates$($EARs$).$ Which would you$$ prefer? $ $500$ from Sherritt paid today or a promise that the firm will pay you $ $800$ in five$$ years? Which would you choose if the Government of Canada offered you the same$$ alternatives?

Question content area bottom

Part $1$

You would$$ prefer: $($Select the best choice$$ below$)$

A$.$

$ $800$ from the Government of Canada in five years and $ $800$ from Sherritt in five years.

B$.$

$ $500$ from the Government of Canada today and $ $800$ from Sherritt in five years.

C$.$

$ $800$ from the Government of Canada in five years and $ $500$ from Sherritt today.

D$.$

$ $500$ from the Government of Canada today and $ $500$ from Sherritt today.