Use the Following Information to Answer the Question(s)below

question 57

Multiple Choice

Use the following information to answer the question(s) below.
Sarah Palin reportedly was paid a $11 million advance to write her book Going Rogue.The book took one year to write.In the time she spent writing,Palin could have been paid to give speeches and appear on TV news as a political commentator.Given her popularity,assume that she could have earned $8 million over the year (paid at the end of the year) she spent writing the book.
-Assuming that Palin's cost of capital is 10%,then the NPV of her book deal is closest to:

• A)$2.00 million.
• B)$2.20 million.
• C)$3.00 million.
• D)$3.73 million.

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Definitions:

Memory

The cognitive function that allows for the storage, retention, and retrieval of information.

Foreign Language

A language that is not the native language of the speaker, but that is used in the area or by a particular set of speakers.

Verbs

Words that describe actions, states, or occurrences, and form the main part of the predicate of a sentence.

Nouns

Words that name people, places, things, or ideas and serve as the subject of a sentence in grammar.