1.A company is considering investing $200 in a long-term asset for which cash inflows over the subsequent three years are estimated to be $70, $50, and $95 respectively. The cost of capital for the project is 8%. Which of the following three capital budgeting calculations is incorrect? (Points : 1)

NPV = -$16.9

IRR = 3.5%

MIRR = 4.9%

All are correct.

More than one of the three are not correct

2.What is the effective compound annual rate of interest on a $10,000 loan which is paid off by 48 monthly payments of $261 if the first payment is due 1 month after receipt of the loan? (Points : 1)

8.73%

9.64%

10.56%

12.15%

None of the above are within rounding error of the correct calculation.

3.Dividends per share of a company are expected to be $3, $5, and $4 for the next three years. Thereafter, the trend rate of growth is forecast to be 10% annually. To obtain a return of 15%, an investor would be willing to pay approximately $______ for the stock. (Points : 1)

59

62

67

88

None of the above are within rounding error of the correct calculation.