Local newspaper headline blared

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NO EXCEL: A local newspaper headline blared: “Jim Smith signed for $10 Million.” A reading of the article revealed that on April 1, 1997, Jim Smith, a junior hockey scoring sensation, signed a $10 million package with the Toronto Maple Leafs. The terms of the contract were $1 million immediately, $800,000 per year for the first 5 years (first payment after 1 year) and $1 million per year for the next 5 years (first payment at year 6). If Jim’s interest rate is 8 % per year, how much is his contract worth at the time of the signing?

Reference no: EM13995920

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