Business, 16.10.2019 06:00 genyjoannerubiera

You are comparing two investment options that each pay 5 percent interest, compounded annually. both options will provide you with $12,000 of income. option a pays three annual payments starting with $2,000 the first year followed by two annual payments of $5,000 each. option b pays three annual payments of $4,000 each. which one of the following statements is correct given these two investment options?
a. both options are of equal value given that they both provide $12,000 of income. b. option a has the higher future value at the end of year three. c. option b has a higher present value at time zero than does option a. d. option b is a perpetuity. e. option a is an annuity.

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You are comparing two investment options that each pay 5 percent interest, compounded annually. both...