A)

What is X if X equals the value of investment A plus the value of investment B? Investment A is expected to pay 19,000 dollars in 7 year(s) from today and has an expected return of 5.25 percent per year. Investment B is expected to pay 14,700 dollars in 6 year(s) from today and has an expected return of 7.87 percent per year.

B)

Indigo River Recycling just bought supplies from Yellow Sand Health. Indigo River Recycling has been offered the 3 possible payment options described in the table. If the discount rate is 9.35 percent, which of the assertions is true?

Option	Terms of payment (amount and timing) from Indigo River Recycling to Yellow Sand Health
A	22,421 dollars in 2 year(s)
B	29,437 dollars in 5 years
C	42,203 dollars in 9 years

Indigo River Recycling should prefer option B more than option A, and Indigo River Recycling should prefer option A more than option C

Indigo River Recycling should prefer option A more than option B, and Indigo River Recycling should prefer option A more than option C

Indigo River Recycling should prefer option B more than option A, and Indigo River Recycling should prefer option C more than option A

Indigo River Recycling should prefer option A more than option B, and Indigo River Recycling should prefer option C more than option A

C)

Platinum Water Shipping just bought supplies from Silver Sun Aviation. Platinum Water Shipping has been offered the 3 possible payment options described in the table. If the discount rate is 9.05 percent, which of the assertions is true?

Option	Terms of payment (amount and timing) from Platinum Water Shipping to Silver Sun Aviation
A	21,031 dollars in 1 year(s)
B	29,657 dollars in 5 years
C	50,259 dollars in 11 years

Silver Sun Aviation should prefer option B more than option A, and Silver Sun Aviation should prefer option C more than option A

Silver Sun Aviation should prefer option A more than option B, and Silver Sun Aviation should prefer option C more than option A

Silver Sun Aviation should prefer option A more than option B, and Silver Sun Aviation should prefer option A more than option C

Silver Sun Aviation should prefer option B more than option A, and Silver Sun Aviation should prefer option A more than option C

D)

Fairfax Paint is planning to sell its McLean, Springfield, and Falls Church stores in T years from today. The firm expects to sell its Falls Church store for a cash flow of H dollars, its McLean store for a cash flow of H dollars, and its Springfield store for a cash flow of M dollars. The cost of capital for the Falls Church store is Q percent, the cost of capital for the Springfield store is Q percent, the cost of capital for the McLean store is W percent, H > M > 0, Q > W > 0; and T > 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?

		The Falls Church store is the most valuable of the 3 stores
		The McLean store is the most valuable of the 3 stores
		The Springfield store is the most valuable of the 3 stores
		None of the other assertions is true
		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