Question
After seeing the effectiveness of Catfishing on MTV, you decide to use Catfishing to get compromising pictures of people to help your clients blackmail their
After seeing the effectiveness of Catfishing on MTV, you decide to use Catfishing to get compromising pictures of people to help your clients blackmail their way to success. You decide to call your business TheBlack Piranha. To start the business, you estimate you need to spend $100,000 today on fixed investments such asbuying the camera equipment, burner phones, and so forth. You also estimate you need to expand your inventory by $10,000. Each year for the next 4 years, you estimate you will have 100 clients that will pay you $1,000 each. You will have variable costs of $300 per client as well as fixed costs for office space of $20,000 per year. If you have a tax rate of 28%, fully recover your working capital at the end of the project, straight line depreciate all incremental fixed investments to zero, and have a discount rate of 10%, what is the NPV of your business idea?
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