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A baseball player is offered a 5 - year contract that pays him the following amounts: Year 1 : $ 1 . 3 million Year
A baseball player is offered a year contract that pays him the following amounts:
Year : $ million
Year : $ million
Year : $ million
Year : $ million
Year : $ million
Under the terms of the agreement all payments are made at the end of each year. Instead of accepting the contract, the baseball player asks his agent to negotiate a contract that has a present value of $ million more than that which has been offered. Moreover, the player wants to receive his payments in the form of a year annuity due. All cash flows are discounted at percent. If the team were to agree to the player's terms, what would be the player's annual salary in millions
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