Ruth nail receives two offers for her seaside home the, Ask an Expert

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Ruth Nail receives two offers for her seaside home. The first offer is for $1 million today. The second offer is for an owner-financed sale with a payment schedule as follows:

End of year	Payment
0(Today)	$200,000
1	200,000
2	200,000
3	200,000
4	200,000
5	300,000

Assuming no differential tax treatment between the two options and that Ruth earns a return of 8 percent on her investments, which offer should she take?

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M92088124

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