All cash flows are discounted at 1200 percent if the team


A baseball player is offered a 5-year contract that pays him the following amounts: Year 1: $1.06 million Year 2: $1.88 million Year 3: $2.46 million Year 4: $2.53 million Year 5: $3.43 million Under the terms of the agreement all payments are made at the end of each year. Instead of accepting the contract, the baseball player asks his agent to negotiate a contract that has a present value of $1.78 million more than that which has been offered. Moreover, the player wants to receive his payments in the form of a 5-year ANNUITY DUE. All cash flows are discounted at 12.00 percent. If the team were to agree to the player's terms, what would be the player's annual salary (in millions of dollars)? (Express answer in millions. $1,000,000 would be 1.00) Answer Format: Currency: Round to: 4 decimal places.

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Financial Management: All cash flows are discounted at 1200 percent if the team
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