You are considering making a movie. The movie is expected to cost $ 10.3 million up front and take a year to produce. Afterthat, it is expected to make $ 4.7 million in the year it is released and $ 1.9 million for the following four years.

What is the payback period of thisinvestment?

If you require a payback period of twoyears, will you make themovie?

What is the NPV if the cost of capital is 10.1 %?