Assignment strictly asks to only use EXCEL formulas and cell references to get the answer, as in =-PV(D2:D8, G9 etc

AB H I J K L M Bill Clinton reportedly was paid $10 million to write his book My Life. Suppose the book took three years to write. In the time he spent writing. Clinton could have been paid to make speeches. Given his popularity, assume that he could eam S8 million per year (paid at the end of the year) speaking instead of writing. Assume his cost of capital is 10% per year. a. What is the NPV of agreeing to write the book (ignoring any royalty payments)? Assume that, once the book is finished, it is expected to generate royalties of $5 million in the first year (paid at the end of the year) and these royalties are expected to decrease at a rate of 30% per year in perpetuity. What is the NPV of the book with the royalty payments? vm Advance payment for book Foregone speaking fees Cost of capital Number of years $10,000,000 $8,000,000 10% = 8 a. What is the NPV of agreeing to write the book (ignoring any royalty payments)? # PV of losing the speaking fees NPV of book deal b. Assume that, once the book is finished, it is expected to generate royalties of $5 million in the first year (paid at the end of the year) and these royalties are expected to decrease at a rate of 30% per year in perpetuity. What is the NPV of the book with the royalty payments? Royalties for book Growth rate of royalties $5,000,000 -30% PV of perpetuity at year 3 PV of perpetuity at year 0 NPV of book deal 28 Requirements 1. Start Excel - completed. 2. You will calculate the present value of the foregone speaking fees by using the function PV. In cell D15, by using the function PV and cell references, calculate the present value of the forgone speaking fees (1 pt.). Note: The output of the function in cell D15 is expected as a negative value. 3. In cell D16, by using cell references, calculate the NPV of the book deal without royalties) (1 pt.). 4. In cell D23, by using cell references, calculate the present value of the future royalty payments (1 pt.). 5. You will calculate the present value (as of year () of the future royalty payments by using the function PV. In cell D24, by using the function PV and cell references, calculate the present value (as of year () of the future royalty payments (1 pt.). Note: The output of the function in cell D24 is expected as a positive value. 6. In cell D25, by using cell references, calculate the NPV of the book deal with royalties) (1 pt.) 7. Save the workbook. Close the workbook and then exit Excel. Submit the workbook as directed