2) Longbow Lumber is purchasing a new horizontal resaw at a cost of $450,000. There is an additional $15,000 delivery and installation cost. The machine has a capital cost allowance (CCA) rate of 25%. What is the incremental undepreciated capital cost (UCC) for year 1?

A. $232,500

B. $225,000

C. $465,000

D. $450,000

E. $435,000

5) Your portfolio has 50% of its value invested in Bombardier and the remainder invested in Lululemon. Bombardier stock has a volatility of 25%, while Lululemon stock has a volatility of 10%. If the correlation between Bombardier and Lululemon is 0.1, what is the standard deviation of your portfolio?

A.17.5%

B.16.7%

C.17.4%

D.13%

E.1.7%

8) Cork Bottlers has 84 million shares outstanding and expects earnings at the end of this year of $54 million. Cork plans to pay out 30% of its earnings as a dividend and 10% of its earnings through share repurchases. The firm has an equity cost of capital of 12%. If Tarmac' earnings are expected to grow by 6.5% per year and these payout rates remain constant, what is Tarmac's share price?

A.$4.68

B.$5.24

C.$3.51

D.$11.69

E.$2.14