1. Fred has $1,500 today and wants $2,010 to buy some sound equipment. How long will Fred have to wait to buy the equipment if he earns 5% compounded annually on his money?

2. UWA Inc. issued a bond with a $1,000 face value and a coupon rate of 8%. If the bond has a life of 5 years, pays annual coupons, and the market rate is 6%, what will the bond sell for?

3. The bonds of TigerPaw, Inc. carry a 9% annual coupon, have a $1,000 face value, and mature in 15 years. Market rate is 5%. What is the market value of Tiger's bonds?

4. UWA Candy and Cookies, Inc. pay a constant annual dividend of $5 per share. How much are you willing to pay for one share if you require a 7% rate of return?

5. Use the following information to answer: 3 year project with initial investment of $1,500, interest rate of 4%, 1st year cash flow of $450, 2nd year cash flow of $550, and 3rd year cash flow of $750

Which of the following is NPV of this two-year project?

What is the Payback Period for this project?

The Profitability Index will be approximately calculated as________.