Calculate the present value for julie

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Julie has just retired. Her company's retirement program has two options as to how retirement benefits can be received. Under the first option, Julie would receive a lump sum of $142,000 immediately as her full retirement benefit. Under the second option, she would receive $21,000 each year for 5 years plus a lump-sum payment of $61,000 at the end of the 5-year period.

Required:

Problem 1: Calculate the present value for the following assuming that the money can be invested at 14%.

Problem 2: If she can invest money at 14%, which option would you recommend that she accept?

Reference no: EM133004830

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