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Your grandfather has offered you a choice of one of the three following alternatives: $12,000 now; $6,000 a year for nine years, or $82,000 at
Your grandfather has offered you a choice of one of the three following alternatives: $12,000 now; $6,000 a year for nine years, or $82,000 at the end of nine years. (Use a Financial calculator to arrive at the answers. Round the final answers to the nearest whole dollar.) a-1. Assuming you could earn 8 percent annually, compute the present value for the following amounts. Present value $12,000 now $6,000 a year for nine years $82,000 at the end of nine years $ a-2. Which alternative should you choose? O $82,000 received at the end of nine years $6,000 received each year for nine years O $12,000 received now b-1. If you could earn 11 percent annually, compute the present value for the following amounts. Present value $ $12,000 now 6,000 a year for nine years $82,000 at the end of nine years $ b-2. Which alternative should you choose? b-2. Which alternative should you choose? $6,000 received each year for nine years $82,000 received at the end of nine years O $12,000 received now
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