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Posted on Sep 28, 2024

A famous quarterback just signed a contract for 18 million, providing 3.6 million a year for 5 years. A less famous receiver signed a contract

A famous quarterback just signed a contract for 18 million, providing 3.6 million a year for 5 years. A less famous receiver signed a contract for 17 million, providing 4 million now and 2.6 million a year for 5 years. The interest rate is 10%.

a. What is the present value of the quarterback's contract?

b. What is the present value of the receiver's contract?

c. Who is better paid?

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