• NESN TV Network is considering airing the Tottenham matches for the next two years. NESN has to pay 100 million upfront for the rights to air the games. NESN projects EBIT of 60 in year 1 and 80 in year 2. NESN’s unlevered equity cost of capital is 10%. The corporate tax rate is 20%.
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• (A) What is the NPV of airing the Tottenham matches if NESN finances the project with equity and has no debt? 
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• (B) Should NESN proceed with the project?

Answer rating: 100% (QA)

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