1. During a 3-months period, the price index increases from 140.5 to 141.40. That is, the 3-months inflation rate is?
2. A stock has a beta of 1.8, the market expected return is 7% and the riskfree rate is 3%. What is the expected rate of return according to CAPM?
3. Gomi Waste Disposal is evaluating a project that would last for 4 years. The project’s internal rate of return is 8.07 percent; its NPV is 8,670 dollars; and the expected cash flows are -59,700 dollars at time 0, 14,600 dollars in 1 year, 45,100 dollars in 3 years, and X in 4 years. What is X?