Fresh Out of College, You Are Negotiating with Your Prospective

question 101

Multiple Choice

Fresh out of college, you are negotiating with your prospective new employer. They offer you a signing bonus of $2,000,000 today or a lump sum payment of $2,500,000 three years from now. If
You can earn 7% on your invested funds, which of the following is true?

• A) Take the signing bonus because it has the lower present value.
• B) Take the signing bonus because it has the higher future value.
• C) Take the lump sum because it has the higher present value.
• D) Take the lump sum because it has the lower future value.
• E) Based on these numbers, you are indifferent between the two.

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Definitions:

Dull Pain

A persistent, often less intense form of pain that might not have a specific, identifiable cause.

Vertebral Fractures

Breaks or cracks in the vertebrae, which are the bones of the spine, often caused by osteoporosis or injury.

Osteoporosis

A condition characterized by reduced bone density and quality, increasing fracture risk due to diminished bone strength.

Deep Somatic

Refers to pain that originates from ligaments, tendons, bones, blood vessels, fasciae, and muscles, often more diffuse than superficial pain.