SITUATION: Alvin is a master's degree holder in business administration. He worked over 12 years in the U. S. and was able to save a considerable amount of money. Upon returning to the Philippines, he decided to transfer his savings to a money market account with a U. S.-based company. Now, he is in sort of a dilemma. One of his concerns is that he is going to be taxed significantly if he decides to cash out. Additionally, the money was transferred to a retirement account which is still earning based on prevailing rates in the U. S. financial markets. Recently, he thought of buying a townhouse in Batac City worth P2.5 million. He has several options on how he would pay for the property: Option A: Withdraw money from his retirement account in the U.S. and use that to pay in full the property in Batac City. Option B: Use his savings in the Philippines to pay a down payment of P500,000 and then finance the other P2 million through a bank loan. Option C: Use the money from the U.S. to pay part of the P2.5 million and then finance he rest through a bank loan. WBLS-OBE MELC-Aligned Self-Learning Module SHS Business Finance He asked his friend, who is a financial adviser, for advice. Alvin's friend told him to consider the following first before making a decision as to what option he should choose: a. How much more earnings can he expect if he leaves that money in the retirement account in the U.S., say in the next 20 years? Twenty years is the parallel time frame of a bank loan here in the Philippines if he decides to choose Option B. b. Do a cost-benefit analysis between Option A and the interest he will have to pay if he takes out a bank loan. c. With regard to Option C, is there really trade-off between interest payments and how much he would earn on the money that will be left in the retirement account. Your output will be evaluated based on completeness, relevance of insight, adherence to format, and clarity of the statement QUESTION AND CREATIVE WRITTEN OUTPUT: 1. Based from the situation given, if Alvin will choose Option B, how much tax will he have to pay? Explain. 2. If he will choose Option A, how much would be the interest incurred if he takes out a bank loan? How much and why? 3. How much would be the possible earnings of the money left in his retirement account? Why? 4. What is the value of his money now as opposed to its value 20 years from now? SAMPLE PROMPTS/OUTLINE 1. If Alvin will choose Option B, the tax would be.... 2. If he will choose Option A, the interest incurred would be 3. If he'll choose Option C, the possible earnings of the money left in his retirement account is. . . . 4. The value of his money now is.... 11