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You are comparing two investments options that each pay 6 percent interest. Both options will provide you with $ 1 2 , 0 0 0

You are comparing two investments options that each pay 6 percent interest. Both options will provide you with $12,000 of income. Option A pays $2,000 the first year followed by two annual payments of $5,000 each. Option B pays three annual payments of $4,000 each. Which of the following statements is correct given these two investments options? Assume a possitive discount rate. Which option has a higher present value? Show the calculations of the present value for both options.

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