17.) A major motion picture s from the 1980s should be made into marginally dece

Question

17.) A major motion picture s from the 1980s should be made into marginally decent tudio is deciding which marginal television shows feature films. Unfor- tunately, while all the movies have positive expected NE ys has 7 talented screen writers. the n NPVs, the studio o ers. The movies, the number of screen writers for an ideal script, and the expected NPVs are listed below: Movie Writers NPV (Smillion) 80 Air Wolf Alf Charles in Charge 3 Mr. Belvedere 5 84 42 20 Assume that the movies return an amount proportional to the number of writers assigned up to the ideal number listed in the table above. What is the total NPV from the best allocation of writers? D A (a) $136 million (b) $184 million (c) $132 million (d) $126 million (e) $80 million

Explanation / Answer

Option D

As movies return an amount proportional to the number of writers assigend to the ideal numbers(i.e.,7)

Total NPV=5/7*80+4/7*84+3/7*42+1/7*20=126

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