Question
In December 2022, the New York Yankees reportedly resigned their most valuable player, Bric Judge, to a contract reportedly worth $50 million (Note: I am
In December 2022, the New York Yankees reportedly resigned their most valuable player, Bric Judge, to a contract reportedly worth $50 million (Note: I am making up numbers, obviously Judge signed for a bigger salary and earnings). Judges salary including other earnings and bonuses was to be paid as $17.1 million in 2023, $8.9 million in 2024, $7.5 million in 2023, and $8.25 million for the 2026 and 2027 seasons. If the appropriate interest rate is 11 percent, what is the present value of the deal that Eric Judge signed with the NY Yankees? Assume all payments are made at the end of each Major League Baseball (MLB) season year.
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