1. A project produces a cash flow of $472 in year 1, $177 in year 2, and $837 in year 3. If the cost of capital is 12.5%, what is the projects PV? If the project requires an investment of $1,000, what is its NPV?

A. Present Value

B. Net Present Value

2. A common stock will pay a cash dividend of $5 next year. After that, the dividends are expected to increase indefinitely at 3% per year. If the discount rate is 10%, what is the PV of the stream of dividend payments?

A. Present Value