Two companies are interested in purchasing the land

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Your company owns a large parcel of land in a neighboring city that you have no use anymore. Two companies are interested in purchasing the land. Company A has offered you $20,000 per year for 20 years for the land. Company B offers that in addition to the 20 equal $20,000 payments, it can pay an additional $10,000 six years from now and an additional $15,000 16 years from now, if you agree to delay the start of the 20 equal $20,000 payments until three years from the date of agreement. Which offer should you take, if the interest rate is 15% (compounded annually).

Reference no: EM13904440

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