1. Five years ago, Mayer Corp purchased a plot of land for $3,880,006. Currently the land is worth $4,972,361. To make the land suitable for a new store to be built, the land will require $142,329 worth of landscaping. To help determine the potential sales generated by a store in this location, Mayer Corp. paid $98,486 dollars for a traffic study. What is the appropriate cash flow at time 0 for this investment?

2. For its new location, Mayer Corp will be installing $1,668,127 worth of new fixtures. These fixtures will be depreciated straight-line to zero over 4 years. What is the annual depreciation expense associated with these fixtures?

3. To open its new location, Mayer Corp. will construct a building costing $1,407,191. To open the store, the company will invest 475,699 is new inventory, receivables will increase by $183,300, and payables will increase by $77,527. Assume the building will be worthless when the store closes. What is the appropriate time 0 cash flow?

4. Mayer Corp expects its new location will sell 562 widgets per year at a cost of $14 each. However, we expect the new location will cannibalize sales of 219 units per year from the closest existing store. What is the appropriate sales figure for our proforma income statement?

5. Your firm is considering a project that costs $72,176. This opportunity will provide cash flows of $18,281, $16,563, $28,930, and $28,469 over the next four years. Your firm has a required rate of return of 9%.

6. Your firm is considering a project that costs $73,442. This opportunity will provide cash flows of $18,641, $20,504, $19,101, and $17,562 over the next four years. Your firm has a required rate of return of 5%.

7. Your firm has a Beta of 0.5 at a time when the expected market return is 13.2% and the risk free rate is 2.7%. What is your cost of equity capital?

8. Your firm currently has 1,133,739 shares of stock outstanding that sell for 33.67. Additionally, you've issued 26,325 bonds, with a par value of $1,000. They currently sell for 104.8% of par.

What is the firm's debt weight?

9. Duke's Sausages is 24% equity financed. You have a cost of debt of 2.3, a cost of equity of 21, and a tax rate of 38.

What is Duke's weighted average cost of capital?