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Analyze the following scenarlos that will require you to compute elther the present value, future value, and/or the a payment amount. Indicate the inputs that you will use to perform your analyses in the spaces provided. Perform your calculation in the space provided for that amount. For example, if you need to compute that present value, present that calculation in the PV space.You recelved a surprise notification from an attorney that you are the beneficlary of a payout from the estate of a long lost relative. You must chose one of the following three options of how you will receive the payout. Determine the value of each option. Then indicate your preferred choice. Assume that you can invest your money at 5.2% APR> Option #1 $800 per month for 20 years beginning immediately Option #2 $3,200 per quarter for 15 years beginning in three months Option #3 $19,200 per year for 10 years beginning in one year Rate Nper PMT PV FV Type Your Preferred Choice

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Option-1 Option-2 Option-3 5.20% 10 $3,200 $19,200 0.4333% 240 1.30% 60 Rate Nper PMT PV FV Type $119,732 $132,747 146,828 [Ref: NOTE] $0 $0 $0 0 0 if cash flow starts occuring at the end of of each period; 1 if cash flow starts occuring immediately Therefore, Preferred Choice is Option-3 as it vields the highest PV among the three options. NOTE For Option-1: PV is calculated using EXCEL FUNCTION PV(rate,nper,pmt,fv,type) where rate-5.2%/12-0.4333%; nper-20x12-240, pmt-800; fv:0; type-1; Here, value for pmt is negative as it denotes cash inflows; type 1 because cash flows start occuring immediately For Option-2: PV is calculated using EXCEL FUNCTION PV(rate,nper,pmt,fv,type) where rate-5.2%/4-1.30%; nper=15x4-60; pmt-3200; fv:0;type:0; Here value for pmt is negative as it denotes cash inflows; type 0 because cash flows start occuring from three months later only For Option-3: PV is calculated using EXCEL FUNCTION PV(rate,nper,pmt,fv,type) where rate-5.2%%; nper-10; pmt-19200; fv:0; type:0; Here, value for pmt is negative as it denotes cash inflows; type 0 because cash flows start occuring from one year later onlyOption-1 5.2%/12 -2012 Option-2 -5.2%/4 -15*4 $3,200 Option-3 5.20% 10 19,200 2 Rate 3 Nper 4 PMT 5 PV 6 FV 7 Type _pVB2,B3,-B4B6B7) S0 -PV(C2,C3,-C4,C6,C7)(D2,03,-D4D6,D7) [Ref: NOTE] S0 SO 0-0 if cash flow starts occuring at the end of of each period; 1 if cash flow starts occuring immediately

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