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A rookie quarterback is negotiating his first NFL contract. His opportunity cost is 10%. He has...
A rookie quarterback is negotiating his first NFL contract. His opportunity cost is 10%. He has been offered three possible 4-year contracts. Payments are guaranteed, and they would be made at the end of each year. Terms of each contract are as follows:
1 2 3 4
Contract 1 $2,500,000 $2,500,000 $2,500,000 $2,500,000
Contract 2 $2,500,000 $3,500,000 $4,000,000 $5,500,000
Contract 3 $6,500,000 $1,500,000 $1,500,000 $1,500,000
As his adviser, which contract would you recommend that he accept? Select the correct answer.
a. Contract 3 gives the quarterback the highest future value; therefore, he should accept Contract 3.
b. Contract 2 gives the quarterback the highest present value; therefore, he should accept Contract 2.
c. Contract 1 gives the quarterback the highest future value; therefore, he should accept Contract 1.
d. Contract 3 gives the quarterback the highest present value; therefore, he should accept Contract 3.
e. Contract 1 gives the quarterback the highest present value; therefore, he should accept Contract 1.
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jeff jeffy answered 2 years agoRelated Solutions
A rookie quarterback is negotiating his first NFL contract. His opportunity cost is 10%. He has...
A rookie quarterback is negotiating his first NFL contract. His
opportunity cost is 10%. He has been offered three possible 4-year
contracts. Payments are guaranteed, and they would be made at the
end of each year. Terms of each contract are as follows:
1
2
3
4
Contract 1
$3,000,000
$3,000,000
$3,000,000
$3,000,000
Contract 2
$2,000,000
$3,000,000
$4,000,000
$5,000,000
Contract 3
$6,500,000
$1,000,000
$1,000,000
$1,000,000
As his adviser, which contract would you recommend that he
accept?
Select the correct answer....
A rookie quarterback is negotiating his first NFL contract. His opportunity cost is 9%. He has...
A rookie quarterback is negotiating his first NFL contract. His
opportunity cost is 9%. He has been offered three possible 4-year
contracts. Payments are guaranteed, and they would be made at the
end of each year. Terms of each contract are as follows:
1
2
3
4
Contract 1
$2,500,000
$2,500,000
$2,500,000
$2,500,000
Contract 2
$2,500,000
$3,500,000
$4,000,000
$5,000,000
Contract 3
$6,500,000
$1,000,000
$1,000,000
$1,000,000
As his adviser, which contract would you recommend that he
accept?
Select the correct answer....
rookie quarterback is negotiating his first NFL contract. His opportunity cost is 8%. He has been...
rookie quarterback is negotiating his first NFL contract. His
opportunity cost is 8%. He has been offered three possible 4-year
contracts. Payments are guaranteed, and they would be made at the
end of each year. Terms of each contract are as follows:
1
2
3
4
Contract 1
$3,500,000
$3,500,000
$3,500,000
$3,500,000
Contract 2
$2,000,000
$3,500,000
$4,000,000
$5,500,000
Contract 3
$6,500,000
$1,000,000
$1,000,000
$1,000,000
As his adviser, which contract would you recommend that he
accept?
Select the correct answer.
a....
5.20 A rookie quarterback is negotiating his first NFL contract. His opportunity cost is 6%. He...
5.20 A rookie quarterback is negotiating his first NFL contract.
His opportunity cost is 6%. He has been offered three possible
4-year contracts. Payments are guaranteed, and they would be made
at the end of each year. Terms of each contract are as follows:
1
2
3
4
Contract 1
$3,500,000
$3,500,000
$3,500,000
$3,500,000
Contract 2
$2,000,000
$3,000,000
$4,000,000
$5,500,000
Contract 3
$7,000,000
$1,500,000
$1,500,000
$1,500,000
As his adviser, which contract would you recommend that he
accept?
Select the correct...
A rookie quarterback is in the process of negotiating his first contract. The team's general manager...
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All of the money is guaranteed and is paid at the end of each
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terms of the contracts are as follows:
(dollars in millions)
Year
Contract 1
Contract 2
Contract 3
1
$1.50
1.0
3.5
2
$1.50
1.5
0.5
3
$1.50
2
0.5
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2.5
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professional football player is negotiating with YNWA United
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opportunity cost is 10%. He has been offered three possible 4-year
contracts. Payments
are guaranteed, and they would be made at the end of each year.
Terms of each
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Kontrak/Contract 1 Kontrak/Contract 2 Kontrak/Contract 3
Tahun 1 RM500,000 RM400,000 RM800,000
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Tahun 3 RM500,000 RM600,000 RM300,000
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