If-Marilyn-can-invest-the-money-at-7-which-options-should-she-choose-Accounting-Question-Help
If-Marilyn-can-invest-the-money-at-7-which-options-should-she-choose-Accounting-Question-Help
Marilyn’s parents have agreed to help her purchase a new car upon graduation in four years. They have given her two choices. The first choice is that they will give her $4,180 each year for the next four years for her to invest herself. The second choice is that they will wait four years and give her $18,540. Marilyn can invest the money at a 3% rate. Option 1 present value is 18012 and Option 2 present value is 18540, Marilyn should take option 2.
If Marilyn can invest the money at 7%, which options should she choose? (Round present value factor calculations to 4 decimal places, e.g. 1.2512 and final answers to 0 decimal places e.g. 58,971.)
OPTION 1OPINION 2
Present Value$_____________$____________
