Offer $2$

$$217,360$ immediate signing bonus

$$100,000$ at the end of Years $1$ through $4$

$$150,000$ at the end of Years $5$ through $10$

$$1,000,000$ and the end of Years $11$ through $40$

Hint: The $$50,000$ should be discounted by $4$ periods $(n=4)$

What is the present value of the Pro Bowl clause adjusted for its probability? $($Hint: multiply each annual payment by the probability

$$117,112$

$$141,773$

$$146,391$

Offer $3$

$$1,006,944$ immediate signing bonus

$$500,000$ at the end of Year $1$

$$1,000,000$ at the end of Year $2$

$$1,500,000$ at the end of Year $3$

$$2,500,000$ at the end of Year $4$

$$184,720$ bonus for any year Luke is selected to play in the Pro Bowl All Star game probability in each year$)$

Canadian Football League

$$1,134,720$ immediate signing bonus

$$2,000,000$ at the end of Years $1$ through $3$

Only signing bonus is guaranteed $(80\%$

probability of being on team each year$)$

What is the present value of the Pro Bowl

adjusted for the probalbility

A$.$ $$117,112$

B$.$ $$141,773$

C$.$ $$146,391$