Suppose that Netflix believes that due to a change in consumer preferences, the effect of the pandemic on its Net Income will annually be $3 billion higher for the three years 2021-2023.  What is the net present value of this increase if Netflix discounts the future at 5% a year?

Assume that the calculation takes place at the end of 2021 and the results of 2021 are not discounted at all. Report your answer in billions of dollars and round your answers to the tenths (i.e. Just make calculations in the billions by using 3 as the expected cash flow and round to the tenths, or if your answer is $10,451,043,937, you report 10.5).

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To calculate the net present value NPV of the increased Net Income for the three ... View the full answer