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You have a choice between two 3-year salary packages. Package 1 will pay you a salary of $4,200 per month for three years. If you
You have a choice between two 3-year salary packages.
- Package 1 will pay you a salary of $4,200 per month for three years. If you complete the three-year contract, you will receive an additional bonus of $4,000 at the end of year 3.
- Package 2 will pay a salary of $4,000 per month for three years, with a signing bonus today of $8,000.
If the discount rate is 6% compounded monthly, what is the value of each salary package?
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