You are considering making a movie. The movie is expected to cost $10.8 million up front and take a year to produce. After that, it is expected to make$4.2million in the year it is released and $1.7million 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 is10.3%?

What is the payback period of this investment?