You recently joined a startup. As part of your compensation you will receive 100 common shares, valued at $100 each, at the end of the first year (t=1). From then on, the number of shares you are awarded grows 5% each year. The last payment you receive is in t=15.

1. a)Assuming a discount rate of 9%, what is the present value of your entire equity award? For the computations, assume the price of the shares stays constant throughout the whole period.
2. b)A rival startup is trying to persuade you to join them. They offer the same timeline of payments but with a starting compensation of $5000 in common stock, 50 shares valued at $100 each, and a growth rate of 3% per year in the number of shares. Again, we assume the price of the shares stays constant. However, since this is a more mature company, they also offer you a $12,000 signing bonus today, and $50,000 cash bonus at the end of every 5 years. Based just on the compensation information given, should you join the rival startup? Continue assuming a discount rate of 9%.