Please help me with the following Thank you Suppose that you calculated the NPV
ID: 2647567 • Letter: P
Question
Please help me with the following
Thank you
Suppose that you calculated the NPV of the two-year run of the movie as $43 million. After the last run of the movie in theaters, New Line plans to sign a streaming deal and sell it on optical discs. Estimated cash flows from this continuation of the project are $4 million starting in year 3, growing, by 2%, forever. Recall that New Line's cost of capital is 12%. What is the total present value of the movie incorporating the theatre run, streaming, and disc sales?Explanation / Answer
Answer