1. A project requires $77,271 of equipment that is classified as a 7-year property. What is the depreciation expense in Year 5 given the following MACRS depreciation allowances, starting with year one: 14.29, 24.49, 17.49, 12.49, 8.93, 8.92, 8.93, and 4.46 percent?
2. Tesco plans to pay a $2 dividend per share in 3 months and a $3 dividend in 6 months. Tescos share price today is $50 and the annual risk-free rate is 6% compounded continuously. What is the price of the 6-month forward contract? Assume that the forward contract expires immediately after the second dividend.