1. You have just received notification that you have won the $1.25 million first prize in the Centennial Lottery. However, the prize will be awarded on your 100th birthday, 76 years from now. The appropriate discount rate is 6.8 percent. What is the present value of your winnings?
2. High Mountain Foods has an equity multiplier of 1.72, a total asset turnover of 1.16, and a profit margin of 4.5 percent. What is the return on equity?
3. Do you think the folling statement is accurate? What conditions would make it more or less true?
a. "Money markets are not used to get rich, but to avoid being poor."