If a company signed a 2-year sponsorship agreement with a sports property for $60,000 the first year with a 5% escalator,the total fee paid in year 2 would be

Question

Quizplus · Accepted Answer

The 5% escalator means that there will be an increase of 5% in the sponsorship fee for year 2. So, 5% of $60,000 is $3,000. Therefore, the total fee for year 2 would be $60,000 + $3,000 = $63,000. Therefore, the best choice is C.

If a Company Signed a 2-Year Sponsorship Agreement with a Sports