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A project will generate annual cash flows of $237,600 for each of the next three years, and a cash flow of $274,800 during the fourth year. The initial cost of the project is $748,600. What is the internal rate of return of this project?

An asset has an average return of 10.63 percent and a standard deviation of 19.41 percent. What range of returns should you expect to see with a 68 percent probability?

Saint Nick Enterprises has 16,500 shares of common stock outstanding at a price of $64 per share. The company has two bond issues outstanding. The first issue has10 years to maturity, a par value of $1,000 per bond, and sells for96.5 percent of par. The second issue matures in 24 years, has a par value of $2,000 per bond, and sells for 104 percent of par. The total face value of the first issue is $200,000, while the total face value of the second issue is $300,000. What is the capital structure weight of debt?

A project with an initial cost of $74,500 is expected to generate annual cash flows of $16,800 for the next 8 years. What is the project’s internal rate of return?

Which one of the following credit instruments is commonly used in international commerce?

The key means of defending against forecasting risk is to:

Humberto is fairly cautious when analyzing a new project and thus he projects the most optimistic, the most realistic, and the most pessimistic outcome that can reasonably be expected. Which type of analysis is he using?

You recently purchased a stock that is expected to earn 10 percent in a booming economy, 4 percent in a normal economy, and lose 4 percent in a recessionary economy. There is 15 percent probability of a boom, 70 percent chance of a normal economy, and 15 percent chance of a recession. What is your expected rate of return on this stock?

Pear Orchards is evaluating a new project that will require equipment of $223,000. The equipment will be depreciated on a 5-year MACRS schedule. The annual depreciation percentages are 20.00 percent, 32.00 percent, 19.20 percent, 11.52 percent, and 11.52 percent, respectively. The company plans to shut down the project after 4 years. At that time, the equipment could be sold for $50,200. However, the company plans to keep the equipment for a different project in another state. The tax rate is 21 percent. What aftertax salvage value should the company use when evaluating the current project?

Suppose you observe the following situation: Security Beta Expected Return A 1.16 .1137 B .92 .0984 Assume these securities are correctly priced. Based on the CAPM, what is the return on the market?