To identify: The athlete who gets the best deal.
Present value refers to the current worth of the future
Given situation:
Two athletes sign a ten-year contract for $80 million, where they were told that either $80 million would be paid in 10 equal installments or the same amount in 10 installments with a maximization of 5% for a year.
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Loose Leaf for Corporate Finance (Mcgraw-hill/Irwin Series in Finance, Insurance, and Real Estate)
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