A)

Gomi Waste Disposal is planning to sell its Columbus, Memphis, and Detroit facilities. The firm expects to sell each of the three facilities for the same, positive cash flow of W dollars. The firm expects to sell its Detroit facility in Z years, its Columbus facility in Z years, and its Memphis facility in T years. The cost of capital for the Detroit facility is Q percent, the cost of capital for the Memphis facility is Q percent, and the cost of capital for the Columbus facility is P percent. We know that T > Z > 0 and Q > P > 0. The cash flows from the sales are the only cash flows associated with the various facilities. Based on the information in the preceding paragraph, which one of the following assertions is true?

The Detroit facility is the most valuable of the 3 facilities

The Memphis facility is the most valuable of the 3 facilities

Two of the three facilities have equal value and those two facilities are more valuable than the third facility or all three facilities have the same value

None of the other assertions is true

The Columbus facility is the most valuable of the 3 facilities

B)

Litchfield Design is planning to sell its San Francisco, Chicago, and Miami stores. The firm expects to sell its San Francisco store for a cash flow of E dollars, its Chicago store for a cash flow of E dollars, and its Miami store for a cash flow of L dollars. The firm expects to sell its San Francisco store in P years, its Chicago store in V years, and its Miami store in V years. The cost of capital for all three stores is R. We know that L > E > 0, P > V > 0, and R > 0. The cash flows from the sales are the only cash flows associated with the various stores. Based on the information in the preceding paragraph, which one of the following assertions is true?

None of the other assertions is true

The San Francisco store is the most valuable of the 3 stores

The Miami store is the most valuable of the 3 stores

Two of the three stores have equal value and those two stores are more valuable than the third store or all three stores have the same value

The Chicago store is the most valuable of the 3 stores

C) Based on the information in the table, which one of the assertions is true?

Investment	Present value of expected cash flow	Expected cash flow	When expected cash flow is expected	Expected annual return
A	?	53,987 dollars	in 5 years	7.45 percent
B	?	164,132 dollars	in 12 years	13.08 percent
C	13,309 dollars	18,409 dollars	in 3 years	?
D	3,510 dollars	10,679 dollars	in 10 years	?

		Investment A is more valuable than investment B and investment C is riskier than investment D
		Investment A is more valuable than investment B and investment D is riskier than investment C
		Investment B is more valuable than investment A and investment D is riskier than investment C
		Investment B is more valuable than investment A and investment C is riskier than investment D