Multiple Choice
A sports team in an effort to solve the salary cap problem has offered a player a contract of $1 million dollars a year for the next season with the payments growing at 7% per year for the next 25 years. The player believes the discount rate for such payments is 13%. What is the value today of taking this contract?
A) $12,405,955.40
B) $16,666,666.67
C) $884,956.09
D) $5,824,965.76
Correct Answer:
Verified
Correct Answer:
Verified
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