1. A sinking fund can be set up in one of two ways. Discuss the advantages and disadvantages of each procedure from the viewpoint of both the firm and its bondholders.
2. How do you calculate a change in residual earnings? Also how do you upload a file or paste in the question area?
3. If investors' aversion to risk increased, would the risk premium on a high-beta stock increase by more or less than that on a low-beta stock? Explain. If a company's beta were to double, would its expected return double?