1. Calculate the nominal annual cost of non free trade credit under each of the following terms. Assume that payment is made either on the discount date or on the due date. a. 1 10, net 20 b. 2 10, net 60 c. 3/10, net 45 d. 2/10, net 45 e. 2/10, net 40.
2. The market capitalization rate on the stock of Aberdeen Wholesale Company is 8%. Its expected ROE is 10%, and its expected EPS is $3. If the firm's plowback ratio is 60%, its P/E ratio will be _________.