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Tom Corp. offers a new employee a single-sum signing bonus at the date of employment, June 1, 2018. Alternatively, the employee can receive $39,000 at
Tom Corp. offers a new employee a single-sum signing bonus at the date of employment, June 1, 2018. Alternatively, the employee can receive $39,000 at the date of employment plus $10,000 each June 1 for five years, beginning in 2022. Assuming the employee's time value of money is 9% annually, what single amount at the employment date would make the options equally desirable?
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