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In: Economics

In 2001 American Airlines entered into a 30-year contract worth $195 million for the naming rights...

In 2001 American Airlines entered into a 30-year contract worth $195 million for the naming rights to the home of the Dallas Mavericks, Dallas Stars, and Dallas Desperados. The contract calls for annual payments of $6.5 million. Explain carefully how you would calculate the economic value of the contract.

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