Dwayne Johnson has been offered $14 million to star in the lead role of the next three
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Question:
Dwayne Johnson has been offered $14 million to star in the lead role of the next three Hobs and Shaw movies. If Dwaine Johnson takes this offer, he will have to forgo acting in other action movies that would pay him $5 million at the end of each of the next three years. Assume Dwayne Johnson's personal cost of capital is 10% per year. Explain why the NPV decision rule might provide Dwayne Johnson with a different decision outcome than the IRR rule when evaluating his three movie deal offer. (Hint: No calculations are needed to answer this question)
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