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Task Sarah Palin reportedly was paid a $12 million advance to wnite her book Going Rogue The book took three years to write. In the
Task Sarah Palin reportedly was paid a $12 million advance to wnite her book Going Rogue The book took three years to write. In the time she spent en paid to give speeches and appear on TV news as a political commentator. Given he end of the year) speaking instead of writing the book. Assume her cost of capital is 5% per year a. What is the NPV of agreeing to write the book (ignoring any royalty payments)? r popularity, assume that she could have earned $8 million per year (paid at the The NPV is million (Round to three decimais) b. Assume that, once the book is finished, it is expected to generate royalties of $5 million in the first year (paid at the end of the year) and these royalties are expected to decrease at a rate of 30% 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 s million (Round to three decimals, DO NOT ROUND THE RESULT FROM (a)) c. How many IRRs are there in part (a)? The number of IRRs is Does the IRR rule give the right answer in this case? Fill in "yes" or no d. How many IRRs are there in part (b)? The number of IRRs is Does the IRR rule give the right answer in this case? Fill in "yes" or 'no
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