Use the Information for the Question(s)below

question 32

Multiple Choice

Use the information for the question(s) below.
Larry the Cucumber has been offered $14 million to star in the lead role of the next three Larry Boy adventure movies.If Larry takes this offer,he will have to forgo acting in other Veggie movies that would pay him $5 million at the end of each of the next three years.Assume Larry's personal cost of capital is 10% per year.
-Larry should:

• A)reject the offer because the NPV < 0.
• B)accept the offer even though the IRR < 10%,because the NPV > 0.
• C)reject the offer because the IRR < 10%.
• D)accept the offer because the IRR > 0%.

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Definitions:

Severe Depression

A disorder of mental health identified by an ongoing state of sadness or a diminished interest in activities, significantly hindering daily activities.

Post-Traumatic Stress Disorder

A psychiatric disorder that may occur in people who have experienced or witnessed a traumatic event.

Eating Disorders

Mental disorders characterized by abnormal or disturbed eating habits, which negatively affect a person's health and well-being.

Anorexia Nervosa

An eating disorder characterized by an intense fear of gaining weight and a distorted body image leading to self-starvation.