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 -$43.00 million if you only look at ticket sales in the
theater. However, they also believe that the movie will create
sales of $80.00 million per year in merchandise. The merchandise
sales will decline each year...