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
Problem 1PS
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Question
The sum of the above nominal cash flows is indeed $330 million! But what is the present value of his contract (at the time it was made) using an annual interest rate of 6%? Please assume the signing bonus is received today (at time t=0), and then the remaining payments are made to Harper at the end of each subsequent year such that the $10 million payment is made 1 year from today, etc.
Enter answer in millions of dollars, rounded to the nearest 10th, as in "123.4"
Transcribed Image Text:P
Phillies
$330 million
Bryce Harper, widely regarded as the most prized free agent in baseball history.
agreed to a record-breaking. 13-year $330 million deal with the Philadelphia Phillies
on Thursday. The MLB Network first reported the deal and The Associated Press,
NBC Philadelphia and ESPN also confirmed Harper's contract. Feb 28, 2019
www.nbcnews.com news sports bryce-harper-sign...
Bryce Harper signs record $330M contract with the ...
Contract breakdown for Bryce Harper's deal with the
Philadelphia Phillies, sources tell ESPN:
2019: $10M (plus $20M signing bonus)
2020: $26M
2021: $26M
2022: $26M
2023: $26M
2024: $26M
2025: $26M
2026: $26M
2027: $26M
2028: $26M
2029: $22M
2030: $22M
2031: $22M
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