What lump sum at employment date would make


K. Skinner and Associates offers a new employee a lump sum signing bonus at the date of employment, October 1, 2014. Alternatively, the employee can take $20,000 at the date of employment plus $15,000 each October 1 for six years, beginning in 2018. Assuming the employee's time value of money is 5% annually, what lump sum at employment date would make her/him indifferent between the two options?

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