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A Rod Case Study

 Essay on the Rod Case Study

Southwest Sporting activities Group Contract for Alex Rodriguez:

The ten-year contract which will Tom Hicks and his team suggested for Alex Rodriguez was one of the biggest ever before in the great Baseball. It was a major Investment decision for the group. The Group had taken over the Dallas Actors few years previous and invested in buying quality players. This kind of worked amazing things for the team and Based in dallas Stars continued to lead the group. Ben Hicks had a policy of spending 50-55% of staff revenue upon team payrolls. If that is maintained he always profits an functioning profit of 10-15%.

Texas Rangers brings more earnings to the group if they reach the American Tournament Series and By reaching the 7th game on the planet Series can add more than $20 mil in gradual revenue. The Rodriguez component was considered to be the driving factor in back of this strategy of the group. There are also elements such as Sponsorship deals, enthusiast attendance, goods sales which contribute to the every year revenues of any team. So , I i am analyzing it based on these lines.

Assumptions:

1 . Tx Rangers reach 2001 American Champion Series and also the 7th game worldwide Series bringing in more revenues for the Southwest Sporting activities Group

2 . Texas Ranger fail to reach both 2001 American Champ Series and also the seventh game stages worldwide Series.

several. Texas Ranger reach either one of them in 2001 with the help of Alex Rodriguez.

(From Show 5)

The state of texas Rangers expenditure on Alex Rodriguez in 2001: $21 Million (contract amount) & $2M (Yearly signing bonus) + this current value with the deferred paid amount using a 3% annual interest ($5M) + insurance high grade (10% of the yearly deal value) in the case of any job threatening injury to Rodriguez

Present Value with the Deferred Paid out amount: five Million/ (1+0. 03)10 = $3720514=3. 72Million

Total Expense: 21+2+3. 72+10 %( 21. 72) =29. 4Million Us dollars.

Immediate Rewards for The state of texas Rangers in 2001:

1 . Present Benefit...

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