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Participation Exercise #3: After viewing this short video respond to the following question. Why is Option #2 the better option even though it paid out the lowest total amount ($12,000,000)? Explain?
Participation Exercise #4: The following article (Links to an external site.) shows the biggest contracts in professional sports. The “contract value” is the total of all of the money to be received by each athlete over the duration of their contract. Why would the “present value” of each contract be a better indicator of the value of the contract rather than the contract value? Hint: some of the money in these contracts will be paid out long after the athlete retires.
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