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You are considering making a movie. The movie is expected to cost $ 10.9 $10.9 million upfront and take a year to make. Afterthat, it
You are considering making a movie. The movie is expected to cost $ 10.9
$10.9 million upfront and take a year to make. Afterthat, it is expected to make $ 4.3
$4.3 million in the first year it is released(end of year2) and $ 2.1
$2.1 million for the following four years(end of years 3 through6) . What is the payback period of thisinvestment? If you require a payback period of twoyears, will you make themovie? Does the movie have positive NPV if the cost of capital is 10.4 %
what is the payback period??
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