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You are considering making a movie. The movie is expected to cost $10.7 million upfront and takes a year to make. After that, it is
You are considering making a movie. The movie is expected to cost $10.7 million upfront and takes a year to make. After that, it is expected to make $4.6 million in the first year it is released (i.e., at the end of Year 2), and $1.9 million for the following four years (i.e., the end of years 3 through 6).
What is the payback period of this investment? If you require a payback period of three years, will you make the movie?
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