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A football team is considering signing a star quarterback to $15 million per year for a total of 5 years with an initial signing bonus
A football team is considering signing a star quarterback to $15 million per year for a total of 5 years with an initial signing bonus of $1 million. (The signing bonus is paid immediately.) The team charges $120 per ticket. How many additional tickets would the team need to sell each year in order for the rate of return on the signing to equal 24.4%? For the cash flow in years 1-5, you can assume that the revenues and expenses occur at the end of each year. You should also assume the team sells the same number of tickets in years 1-5."
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