You plan to sell your dream home 8 years from today at a price of $2,000,000. A friend offers to buy the house today for $1 million cash. If your cost of capital is 7.3%, should you take the cash offer today?

Group of answer choices

1. No, because the future value of the cash offer (8 years from today) is only $1,757,105

2. No, because the present value of the future selling price is $948,642

3. Yes, because the present value of the future selling price is $1,138,235

4. No, because it would be a loss of $1 million in value