Obtain the greatest present value of income

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Reference no: EM13887798

Which of the following payment terms should a professional athlete prefer in a “ten million dollar” five-year contract if the athlete wants to obtain the greatest present value of income?

A) Receive $2 million each of the next five years.

B) Receive $6 million next year and then receive $1 million in each of the subsequent four years.

C) Receive $1 million in each of the next four years and then receive $6 million in the subsequent year.

D) All of the above have the same present value of income.

Reference no: EM13887798

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