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1. An NBA player signed a mega-million deal paying $5.00 million per year for years 1,2 and 3 of the contract and $9.00 million per
1. An NBA player signed a mega-million deal paying $5.00 million per year for years 1,2 and 3 of the contract and $9.00 million per year for years 4 and 5. What is the effective value of this deal today if the discount rate is 8.10%?
2. You are set to receive $2,030 annually (at the end of each year) forever with returns of 14.60% for the first 7 years and 3.00% thereafter. What is the current value of this investment?
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