What would be the players annual salary

Assignment Help Finance Basics

Reference no: EM131943176

Question: A baseball player is offered a 5-year contract which pays him the following amounts: Year 1: $1.2 million Year 2: $1.6 million Year 3: $2.0 million Year 4: $2.4 million Year 5: $2.8 million Under the terms of the agreement all payments are made at the end of each year. Instead of accepting the contract, the player asks his agent to negotiate a contract which has a present value of $1 million MORE than that which has been offered. Moreover, the player wants to receive his payments in the form of a 5-year annuity (payments at the end of the year). All cash flows are discounted at 10%. If the team were to agree to the player's terms, what would be the player s annual salary?

Reference no: EM131943176

Questions Cloud

Assess the bank performance : If the bank has shareholders' equity of $3 million and retained earnings of $2 million while the private loans amounted to $25M, $50M for the total amount.

Briefly describe the industry market for ZARA : Assignment - Markets Segments And Decision Making. Briefly describe the industry market for organisation ZARA. Describe nature of competition in your industry

Which project would you choose for your company : Project A's NPV data equals the Net Operating Cash Flows of -$4,919,284, the Internal Rate of Return (IRR) demonstrates that the risk of the project is 5.36%.

Real estate investment trusts and infrastructure funds : Two managed investment products offered through the ASX are real estate investment trusts (REIT) and infrastructure funds.

What would be the players annual salary : A baseball player is offered a 5-year contract which pays him the following amounts: Year 1: $1.2 million Year 2: $1.6 million Year 3: $2.0 million.

What is the best estimate of stock price per share : Based on the corporate valuation model, the value of Chen Lin Inc.'s operations is $ 852 million. Its balance sheet shows $ 112 million in notes payable.

What are the five risks common to financial institutions : What are the five risks common to financial institutions?

Calculate payback period if the after-tax rate of return : Calculate the payback period if the after-tax rate of return of 20 % is expected.

What yield on gm bonds would make weston treasurer : Barth Corporation has some money to invest, and its treasurer is choosing between General Motors bonds and State of Illinois bonds.

User Account

All Pages