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Your grandfather would like to share some of his fortune with you. He offers to give you money under one of the following scenarios
Your grandfather would like to share some of his fortune with you. He offers to give you money under one of the following scenarios (you get to choose): 1. $8,000 per year at the end of each of the next eight years 2. $50,100 (lump sum) now 3. $100,250 (lump sum) eight years from now (Click the icon to view Present Value of $1 table.) Read the requirements. (Click the icon to view Present Value of Ordinary Annuity of $1 table.) Requirement 1. Calculate the present value of each scenario using an 8% discount rate. Which scenario yields the highest present value? (Round the factors to three dem nearest whole dollar.) Scenario 1, 8% discount rate, Present value Scenario 2,8% discount rate, Present value= Scenario 3,8% discount rate, Present value appears to be the best option. Based on an 8% Interest rate, its present value is the Requirement 2. Would your preference change if you used a 12% discount rate? Compute the present value of each scenario using a 12% discount rate. (Round the factors to three decimal places, X.XXX Round the present value to the nearest whole d Scenario 1, 12% discount rate, Present value Scenario 2, 12% discount rate, Present value Scenario 3, 12% discount rate, Present value appears to be the best option. Based on a 12% interest rate, its present value is the
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