You are considering making a movie. The movie is expected to cost $ 10.6 million up front and take a year to produce. After that, it is expected to make $ 4.5 million in the year it is released and $ 1.9 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 % ?