Bill Clinton reportedly was paid$15.0million to write his book MyLife.The book took three years to write. In the time he spent writing, Clinton could have been paid to make speeches. Given his popularity, assume that he could earn$8.4million per year (paid at the end of the year) speaking instead of writing. Assume his cost of capital is10.4%per year.a. What is the NPV of agreeing to write the book (ignoring any royalty payments)?b. Assume that, once the book is finished, it is expected to generate royalties of$5.3million in the first year (paid at the end of the year) and these royalties are expected to decrease at a rate of30%per year in perpetuity. What is the NPV of the book with the royalty payments? Question content area bottom

Part 1

a. What is the NPV of agreeing to write the book (ignoring any royalty payments)?

(Round to the nearest dollar.)

Part 2

b. Assume that, once the book is finished, it is expected to generate royalties of $5.3 million in the first year (paid at the end of the year) and these royalties are expected to decrease at a rate of30% per year in perpetuity. What is the NPV of the book with the royalty payments? The NPV of the book with the royalty payments is...

(Round to the nearest dollar.)