1.)

If a company can earn an annual risk-free rate of interest of 2 percent for the foreseeable future, how much money it must investment now in a pension retirement fund that will guarantee the payment to its retired personnel an overall base annual amount of $40,000 to be increase by 1 percent annually, forever? Impossible to calculate m3 $2,020,000 m c $4,040,000 o D_ $80,800 Which of the following statements is false regarding protable and unprotable growth? If a rm wants to increase its share price, it must cut its dividend and invest more. If the firm retains more earnings, it will be able to pay out less of those earnings, A B_ which means that the rm will have to reduce its dividend. Afirm can increase its growth rate by retaining more of its earnings. bl Cutting the firm's dividend to increase investment will raise the stock price if, and only A D_ if, the new investments have a positive NPV