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2. What is the present values of Team's Offer using a 14 percent discount rate? (Round answer to 2 decimal places, e.g. 15.25.) 3.What is the present values of Counteroffer using a 14 percent discount rate? (Round answer to 2 decimal places, e.g. 15.25.) 4. Which of the three contacts has the highest present value

2. What is the present values of Team's Offer using a 14 percent discount rate? (Round answer to 2 decimal places, e.g. 15.25.) 3.What is the present values of Counteroffer using a 14 percent discount rate? (Round answer to 2 decimal places, e.g. 15.25.) 4. Which of the three contacts has the highest present value

Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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Answer the following questions including the one on the image provided

2. What is the present values of Team's Offer using a 14 percent discount rate? (Round answer to 2 decimal places, e.g. 15.25.)

3.What is the present values of Counteroffer using a 14 percent discount rate? (Round answer to 2 decimal places, e.g. 15.25.)

4. Which of the three contacts has the highest present value?

Tirade Owens, a professional athlete, currently has a contract that will pay him a large amount in the first year of his contract and smaller amounts thereafter. He and his agent have asked the team to restructure the contract. The team, though reluctant, obliged. Tirade and his agent came up with a counter offer. What are the present values of each of the contracts using a 14 percent discount rate? Year Current Contract Team's Offer Counter offer $7,362,059 $3,607,409 $4,785,338 $3,490,349 $3,664,866 $7,225,022 $3,380,557 $4,800,391 $4,529,946 4 $7,823,040 $16,819,536 $12,047,482 What is the present values of Current Contract using a 14 percent discount rate? (Round answer to 2 decimal places, e.g. 15.25.)
Transcribed Image Text:Tirade Owens, a professional athlete, currently has a contract that will pay him a large amount in the first year of his contract and smaller amounts thereafter. He and his agent have asked the team to restructure the contract. The team, though reluctant, obliged. Tirade and his agent came up with a counter offer. What are the present values of each of the contracts using a 14 percent discount rate? Year Current Contract Team's Offer Counter offer $7,362,059 $3,607,409 $4,785,338 $3,490,349 $3,664,866 $7,225,022 $3,380,557 $4,800,391 $4,529,946 4 $7,823,040 $16,819,536 $12,047,482 What is the present values of Current Contract using a 14 percent discount rate? (Round answer to 2 decimal places, e.g. 15.25.)
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