#21 а unanswered Suppose that Disney is considering one more Toy Story movie. The company is not confident in box office
Posted: Tue Nov 23, 2021 8:51 am
company is not confident in box office sales, but they do believe that the file will create merchandising opportunities (DVDs, toys, clothes...etc). Their early analysis believes the move will have an NPV of -540.00 million if you only look at ticket sales in the theater. However, they also believe that the movie will create sales of $73.00 million per year in merchandise. The merchandise sales will decline each year by 28.00% in perpetuity. Let's assume that after-tax operating margin on these sales is 10.00%, and that Disney has a cost of capital at 9.00% not_submitted Attempts Remaining: Infinity Let's value this as a perpetuity. The merchandise sales will continue indefinitely, BUT the sales will decrease each year. What is the net NPV for creating the movie? answer in terms of millions, so 1,000,000 would be 1.00) Submit Answer format: Currency: Round to: 2 decimal places.
#21 а unanswered Suppose that Disney is considering one more Toy Story movie. The