What is payback period of this investment

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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 $4.3 million in the year it is released and $1.7 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 10.9%

a. What is the payback period of this investment ?

The payback period is ____ years

b. Yes/No

c. Does the movie have positive NPV if the cost of capital is 10.9%?

d. Therefore, the NVP is ___________.

Reference no: EM132028677

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