Steve Hawke is a football star who has been offered contracts by two different teams. The payments (in millions of dollars) under the two contracts are shown below: Steve plans to accept the contract that provides him with the highest NPV. At what discount rate would he be indifferent between the two contracts?
A) 10.85%
B) 11.35%
C) 12.66%
D) 13.98%

Question

Steve Hawke is a football star who has been offered contracts by two different teams. The payments (in millions of dollars) under the two contracts are shown below:  Steve plans to accept the contract that provides him with the highest NPV. At what discount rate would he be indifferent between the two contracts?
A) 10.85% 
B) 11.35% 
C) 12.66% 
D) 13.98%

Quizplus · Accepted Answer

The Answer of Steve Hawke is a football star who has been offered contracts by two different teams. The payments (in millions of dollars) under the two contracts are shown below:  Steve plans to accept the contract that provides him with the highest NPV. At what discount rate would he be indifferent between the two contracts?
A) 10.85% 
B) 11.35% 
C) 12.66% 
D) 13.98%

Steve Hawke Is a Football Star Who Has Been Offered