You are considering making a movie. The movie is expected to cost $ 10.4 million up front and take a year to produce. After that, it is expected to make $ 4.6 million in the year it is released and $ 1.6 million for the following four years.

What is the payback period of this investment?

If you require a payback period of two years, will you make the movie?

Does the movie have positive NPV if the cost of capital is 10.1 %?