Problem $9-8($Algo$)$ Present value $[$L$09-3]$

Your father offers you a choice of $$110,000$ in $11$ years or $$46,000$ today. Use Appendix B as an approximate answer, but calculate your final answer using the formula and financial calculator methods.

a$-1.$ If money is discounted at $11$ percent, what is the present value of the $$110,000?$

Note: Do not round intermediate calculations. Round your final answer to $2$ decimal places.

Present value

a$-2.$ Which offer should you choose?

$$110,000$ in $11$ years

$$46,000$ today

b$-1.$ Now assume the offer is $$110,000$ in $8$ years or $$46,000$ today. What is the present value of the $$110,000$ at $11$ percent for $8$ years?

Note: Do not round intermediate calculations. Round your final answer to $2$ decimal places.

Present value

b$-2.$Now, which offer should you choose?

$$110,000$ in $8$ years

$$46\mathrm{.}000$ today