What is the discounted payback period for the project

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Reference no: EM133616782

Problem

Goose Lane, a publisher located here in Fredericton, is seeking to diversify its strategy. It wishes to purchase the English-language rights to the Japanese manga series Classroom Soul Slayer. It will cost $2.90 million for licensing and translation of the 20-volume series. It is anticipated the series will generate $800,000/yr in profits for seven years, after which the right of ownership reverts back to the creator. Furthermore, at termination (i.e., at the end of seven years), Goose Lane is required to remit a single-payment royalty fee equal to one year's worth of profits (again, expected to be $800,000). Assume Goose has an 10% RRR. Calculate the simple payback period. (A timeline is optional for this problem

What is the discounted payback period for the project? (A timeline with a vertical running-total column is required for this problem.)

Reference no: EM133616782

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