1. Consider a firm that has invested in a 5-year project. It faces a 40% corporate tax rate and its investment belongs to the CCA class with a 30% depreciation rate. By how much the NPV of the project will increase if the firm were able to use its inventory more efficiently and reduce the required NWC by $20,000? Assume the project's discount rate is 12%.

	$12,000
	$9,974
	$9,013
	$8,65

2. You are contemplating investing in two stocks, GM and Ford, that have an expected return of 12% and 9% respectively. If your target expected return from your portfolio is 10%, what should be the weight of your investment in GM?

	0.17
	0.33
	0.67
	It cannot be determined from the information above

3. You have deposited $1,500 in an account that promises to pay 8% compounded quarterly for the next five years. How much will you have in the account at the end of 5 years?

	$1,598.33
	$2,228.92
	$2,203.99
	$6991.44

4. You just learnt that you are going to receive $300 a year forever. In addition, this amount will increase at the rate of 5% forever. However, these payments will not begin until five years from today. What is the present value of these payments assuming a discount rate of 6%?

	22,417.75
	23,762.81
	25,188.58
	30,000.00

5. First Bank pays 6.2% interest compounded semi-annually, Second Bank pays 6.1% compounded quarterly, and Third Bank pays 6% compounded monthly. Which bank pays the highest effective annual rate?

	First Bank
	Second Bank
	Third Bank
	There is no single highest effective annual rate