3. 4. Suppose that a for profit hospital pays a quarterly dividend to its shareholders. It has just paid a dividend of $5. Investors will use a required rate of return of 4% quarterly to value their stock in the hospital. What is the current stock price? Sonia has been offered an investment project that produces cash flows of $14,000 that she receives at the beginning of every year for the next 5 years. If the required rate of return is 10% effective annually determine the fair price that Sonia would be willing to pay for this project. To renovate a long-term care facility in ten years the owners need to accumulate $400,000. It is estimated that they can deposit $20,000 a year into an interest earning account. What is the rate of return that they will need to earn on their deposits to have saved enough money? 6