Matt, a Star Basketball Player, Is Looking to Join a New

question 16

Multiple Choice

Matt, a star basketball player, is looking to join a new NBA team.The Bulls are offering him $24 million for one year.The Heat is offering him $10 million this year and $7.0 million in each of the next two years.The market interest rate is 5 percent.What is the present value of the offer from The Heat in millions (rounded to the nearest one hundred thousand dollars) ?

• A)$22.5 million
• B)$23.0 million
• C)$24.0 million
• D)$25.2 million

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Definitions:

Sedimentary Rock

Rock formed from the accumulation and lithification of mineral and organic particles on Earth's surface, often containing fossils and providing insights into Earth's history.

Saudi Arabia

A country located on the Arabian Peninsula, known for its vast deserts, oil reserves, and as the birthplace of Islam.

Carbon Dioxide

A colorless, odorless gas produced by burning carbon and organic compounds and by respiration, a key greenhouse gas contributing to global warming.

Coal

A combustible black or brownish-black sedimentary rock used primarily as a fuel in electricity generation.