Suppose that Eli Tomac, a professional motocross racer, is looking for a new sponsor. Suppose that Tomac is considering two possible contracts from different companies. Note that the salaries are paid at the end of EACH year.

$\backslash$table$[[,$Contract #$1($Oakley$),$Contract #$2(100\%)],[$Signing bonus $($paid today$),$$$5$ million,$$5$ million$],[$First$-$year salary,$$2$ million,$$4$ million$],[$Second$-$year salary,$$4$ million,$$4$ million$],[$Third$-$year salary,$$7$ million,$$5$ million$]]$

The interest rate is $10\%.$ Based on this information, which of the following is true?

Tomac should take the Oakley contract because it has a higher present value

Tomac should take the $100\%$ contract because it has a higher present value.

Tomac is indifferent between the two contracts because they are both worth $$12$ million.

Tomac is indifferent between the two contracts because they are both worth $$10\mathrm{.}9$ million.