Result of your prowess-what is the present value

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As a result of your prowess in identifying how many rolls of toilet paper a typical American family keeps on hand, you win the opportunity to choose one of the following: $1,800 today, $8,000 in 11 years, or $26,000 in 27 years. Assuming that you can earn 16 percent on your money, which should you choose?

(A) If you are offered $8,000 in 11 years and you can ear 12% on your money, what is the present value of $8,000?

(B) If you are offered $26,000 in 27 years and you can earn 12 percent on your money, what is the present value of $26,000?

Reference no: EM13978684

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