Question: you can use answer #20 to help with the calculations of #21! will upvote! Show Hint Suppose that Disney is considering one more Toy Story

you can use answer #20 to help with the calculations of #21!

will upvote!

Show Hint Suppose that Disney is considering one more Toy Story movie. The 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 -$39.00 million if you only look at ticket sales in the theater. However, they also believe that the movie will create sales of $85.00 million per year in merchandise. The merchandise sales will decline each year by 22.00% in perpetuity. Let's assume that after-tax operating margin on these sales is 15.00%, and that Disney has a cost of capital at 10.00%. 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. Suppose that Coca-Cola decides introduce a new diet soft drink in the market. The product is expected to sol well but in the sales of some of their other products. Analysts expect that the other diet drinks that Coke minnn cains for Coke is 23.00%. What is the yearly 220 co Suppose that Disney is considering one more Toy Story movie. The company is not conlident in box offices, but they do believe that the file will create merchandising opportunities (DVDs, toys, clothes, etc. Thorary anys believes the move will have an NPV of $39.00 million if you only look at ticket sales in the theater. However, they also believe that the movie will create sales of $85.00 million per year in merchandise. The merchandise will decline each year by 22.00% in perpetuity. Let's assume that after-tax operating in on these si 15.00$, and that Disney has a cost of capital at 10.00% Antemps What is the cash flow created by the merchandise side effect in the first your answer in terms of milions, so 1.000.000 would be 1.00) 12.75 Answer format: Currency: Round to: 2 decimal places Show Hiet is not confidentin box offices, but

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock blur-text-image

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!

BCE has included service revenue of $22,100 as a result of a number of one year service policies sold late in December as an experiment. These service policies became effective on January 1, 20X4, or...

will rate highly! need help with these three of the cus. This is where www This will now ITO y Dear Band When the Aromat So they They were DowPV7900 you by chowy wire. The ich by Lancome 1.00 Dow...

URGENT HELP!!!!! Please answer within 2 hours. Q: Read the case and imagine yourself as a management consultant of Pixar, give at least 700 words recommendation written report for this company(may...

Please read the PIXAR CASE - AND ANSWER THE FILL IN CHARTS AT THE BOTTOM OF THE PAGE! CASES CASE 12 PIXAR* In spite of its domination of Academy Awards for Best Ani- broke all records for opening...

BUS 616 Summer, 2015 Final Exam Answer the following questions based on the 2014 annual report of the Walt Disney Company (Disney). A link to the annual report is provided with the posting of this...

MiniCase 15: Disney: Building Billion-Dollar Franchises Disney: Building Billion-Dollar Franchises This activity is important because, as a manager, you must be able to identify the growth and...

Report: Your report should include: I. NSU Cover page (1 page in length). It will present the name of the case and the author(s) of the report. II. Executive Summary (1 page in length). The Executive...

Answer 20 and 21! Suppose that Disney is considering one more Toy Story movie. The company is not confident in box office sales, but they do believe that the file will create merchandising...

I am wondering if anyone has corrected solutions to fnce 300 assignments 1 2 and 3. I am concered about my answers and would love to compare. Pretty sure on my answers for 1 and 2 mainly interested...

28) A firm is adding a new blast furnace to its operation. The new furnace will cost $28.00 million and will require a few old parts that the firm has in inventory. The firm could otherwise sell...

#20 & #21 please! Suppose that Disney in considering one more Toy Story movie. The oompany is not confident in box ofice sales, but they do believe that the file will create marchandising...

Example 2 described an experiment in which telephone callers to an airline were put on hold with an advertisement, Muzak, or classical music in the background. Each caller who was chosen was also...

The violent crime rates (in number of violent crimes per 100,000 people) in the United States are shown in Table 44 for various years. Table 44 U.S. Violent Crime rates Violent Crime Rate Year(crimes...

You may be reluctant to not purchase purchase the machine if you believe that your performance may actually be measured using This approach would show a return on the initial investment that the...

6 and 7 please Question 6 4 pts A recent survey found 30% of people like using ride service Uber. In a random sample of 4 people, find the following: Probability that all like Uber. 0.028 0.130 0.00B...