1.) Calculate the following values for a project that requires an initial investment of $38,370 and has equal annual cash inflows of $10,000 each year for the next 8 years. Assume a cost of capital of 14%. You must show your work in formulas.
a. Payback period
b. Net present value
c. Internal rate of return
2.)What is the maximum price you would pay for a bond given the following information? The bond has a 7.5% coupon rate, it matures in 20 years, it pays interest annually, and it will pay the holder $1,000 upon maturity. You require a rate of return of 5% compounded annually.
3.)Given the following marginal tax schedule, what would be the tax on $95,000 of taxable income?