1. Is the number of shares outstanding linked to the volatility of the firm's stock?
2. An insurance company offers you an end of year annuity of $35,000 per year for the next 5 years. They claim your return on the annuity is 8 percent. What should you be willing to pay today for this annuity?
3. An annuity makes 5 equal annual payments of $2,000. The first payment begins in exactly 12 years. If the relevant discount (interest) rate is 12%, what is the present value (today) of the annuity?