2. RELEASE SEQUENCE TheatreDVD/Blu-Ray Online Entertainment Content Provider TV Licensing Licensing Fee = 63%*DVD/Blu-Ray Revenue

3. TASK 1

4. WACC 2013 Ke : 17.42% E/V : 66% Kd : 1.98% Tax : 40% D/V : 34% WACC = 11.84% Quarter WACC = 2.84%

5. REFERENCE GROUP

6. CAPITAL BUDGETING

7. TASK 2

8. WACC 2014 Ke : 66% E/V : 16.89% Kd : 34% Tax : 40% D/V : 1.98% BP : 100 WACC = 12.49% Quarter WACC = 2.99%

9. ADJUSTMENTS Box Office Revenue (-24%) DVD/Blu-Ray (+12%) Extra Cost : IP restriction ( -$15,000 ) NPV : -2,077,995.11 IRR : -0.13%

10. TASK 3

11. ADJUSTMENTS Problem: Box Office Revenue (-90%) To breakeven:  DVD/Blu-Ray price (+115%)  Licensing rate (+192.77%)  DVD/Blu-Ray Price (+94%), Licensing rate (+19.04%)

12. ADDITIONAL RECOMMENDATION Movie scene dissection  selling to independent movie maker  as advertisement footages  reuse footage for upcoming projects

13. QUESTIONS ?