14:51 Question Al Eric will be retiring at the end of ten years from today. He is considering investing in a retirement investment plan offered by the bank. The plan will require Eric to pay $1.5 million dollars immediately. When Eric retires at the end of ten years, the investment plan will pay Eric $20,000 at the beginning of every month for the next twenty-five years. If the relevant interest rate is 6% a year compounded monthly, should Eric invest in this plan? Question A2 Davison Group has just paid an annual dividend of $4. This dividend is expected to grow at 5 percent a year for the next two years. Starting from year 3, the company is expected to pay a fixed dividend of $3 a year forever. What is the current share price assuming a required return of 15 percent? Question A3 Hay Corporation has bonds that matured in ten years trading on the market. Moody just announced that they have decided to downgrade the credit rating of the company's bonds from Baa to Ba. What do you think will happen to the company's bond price immediately after the announcement (assuming that this is the only information)? Explain your answer. Question A4 A project has an initial cost of $280,000 and is expected to last for five years. This investment of $280,000 will be 100 percent depreciated (straight line) over five years. The net income generated by the project is shown below: Year 1 2 3 Net Income ($) 19,000 21,000 22,000 25,000 20,000 4 5 The company has a policy of accepting a project if the project has an average accounting return (AAR) of more than 18 percent. Should the company accept this project