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You are now twenty - three years old and have just finished university. You have two job offers. The first offer ( Job A )
You are now twentythree years old and have just finished university. You have two job offers. The first offer
Job A is with a municipal government ie low risk Your salary will start at $ per year and will grow
at the rate of pa If you take this job, you will retire at age sixtyfive. The second offer Job B is with a
private company and involves a higher risk. Your salary will start at $ per year and will grow at the rate of
pa If you take this job, you want to retire when you reach age sixty. Suppose that you believe that the
valuation rates appropriate for the two jobs are pa and pa respectively both are annual
compounding rates Suppose also that your salary is paid at the end of the year. Strictly on financial terms,
which job will you choose?
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