Question: Please include the equations and how to solve them in Excel. Thank you. A. A baseball player is offered a 5-year, $50 million contract which

Please include the equations and how to solve them in Excel. Thank you.

A. A baseball player is offered a 5-year, $50 million contract which pays him the following amounts at the end of eachyear:

Year 1:$6 millionYear 2:$8 millionYear 3:$10 millionYear 4:$12 millionYear5:$14million

Instead of accepting the contract, the player asks for a contract that has the team paying the same total amount, butpayments are equal ($10 million a year) and come at the beginning of each year for the 5 yearsinstead of the end of theyear (5 total payments). Assuming that the appropriate discount rate is 6% per year, what is the difference in the presentvalueof twooffers?

B. A donor established a scholarship that will pay $10,000 per year to a Kelley student. The scholarship will be awarded for the first time in December of 2023 (i.e., the first payment occurs two years from now). The donor decides that thescholarship will be provided in perpetuity. The IU Foundation manages investments like this for the Business School.The Foundation anticipates earning an APR of 4.6% per year on the invested funds. What is the amount of the donationthatmustbegiven to theIUFoundationtodaytoendowthisKelley scholarship?

C. Your grandmother is trying to determine the value of her bond portfolio and turns to you for help.Find the currentmarket valuesofthecomponentsof your grandmother'sportfolio.

  1. 100zerocoupon bondswitha$1,000facevalueand4 yearstomaturity.TheYTMon thesebondsis4.3%(assume annualcompoundinghere). Whatisthetotalvalueof these 100zerocouponbonds?

2. 50 bonds with a $1,000 face value and a coupon rate of 5%.These bonds have 12 years left to maturity and paycouponsonasemiannualbasis.TheYTMofthesebondsis5.5%.Whatisthetotalvalue ofthese50bonds?

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