1. You have been offerred the opportunity to invest in a project that will pay $4000 per year at the end of years one through three and $12412 per year at the end of years four and five. If the appropriate discount rate is 10.7% per year, what is the present value of this cash flow pattern?
2. The following are the cash flows of two projects: Year Project A Project B 0 -$ 235 -$ 235 1 115 135 2 115 135 3 115 135 4 115 What are the internal rates of return on projects A and B? (Enter your answers as a percent rounded to 2 decimal places.)
3. Value at risk (VAR) measures which of the following? Market risk in abnormal market conditions B.) Min Capital required to hedge against market risk C.) Market risk in normal market conditions D.) Ratio of securities vs. cash