#3,4

3. If a company raises money by issuing new stocks, a current shareholder has the right to purchase new shares on a pro rata basis (can keep the same percentage interest in the company). This provision in a company's bylaws is called the: a. Proxy fight c IPO Provision b. percentage right d. preemptive right Use the following information for questions 4 and 5: XYZ Company is considering the purchase of a new machine that costs $300,000. Cash inflows that will result from the new machine will be Year 1 Year 2 Year 3 Year 4 $130,000 $110,000 $75,000 $20,000 The machine will be outdated after the fourth year, and will not be sold. XYZ's required rate of return is 6%. 4. What is the project's payback period? a. 2.52 years c. 2.95 years b. 2.80 years d. 2.73 years