Give a total value for each of their offers

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Reference no: EM131966155

Kim and Kanye have hired you to determine who has the best endorsement offer. Kim has been offered the job as a spokesperson for the National Library Foundation (they figure that if they can get her to read a book, anyone will be able to).

The NLF (they explain to her what the letters mean later) will pay her $2,000 per month starting ten years from today for a total of 120 months.

She then will receive $40,000 per year for six years with the first payment of $40,000 occurring one month after the last payment of $2,000. She also will receive $70,000 every year for five years with the first of these coming six months from today.

Kanye has been offered a job as the spokesperson for the National Literacy Society (he is happy it has nothing to do with what Kim is doing). The NLS will pay him $30,000 per year for twenty years with the first of these coming today. He will also receive $400,000 six months after his last payment of $30,000.

Finally he will receive $500,000 fifty years from today - he was worried that he would not have enough for a 75th birthday gift for himself.

They want to know who has the best offer in today's dollars.

Assume an 9% (monthly) rate for your analysis. Show all of your work and give a total value for each of their offers.

Reference no: EM131966155

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