What is the present value of the second option

Reference no: EM13260635

You've just joined the investment banking firm of Dewey, Cheatum, and Howe. They've offered you two different salary arrangements. You can have $8,500 per month for the next three years, or you can have $7,200 per month for the next three years, along with a $38,500 signing bonus today. Assume the interest rate is 8 percent compounded monthly.

Requirement 1:

If you take the first option, $8,500 per month for three years, what is the present value?

Requirement 2:

What is the present value of the second option?

Reference no: EM13260635

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