1. Why it is not a good idea/practicalto buy insurance on high frequency and high severity risk?
2. Titan Industries is not expected to pay a dividend until 10 years from now, at which time it is expected to pay a dividend of $1.25 and increase the dividend at a rate of 4% thereafter. If the required rate of return is 12%, the current value of Titan is closest to:
3. ?Last Christmas, Danny received an annual bonus of $1,500. These annual bonuses are expected to grow by 5 percent for the next 5 years. How much will Danny have at the end of the fifth year if he invests his Christmas bonuses (including the most recent bonus) in a project paying 8 percent per year?