1. Calculate the PV of cash flows below and the NPV of the project

now Y1 Y2 Y3 Y4 Y5 Y6 Y7 Y8 Y9 Y10 Y11

-250 -75 -75 -75 -75 -75 -75 -75 -75 -75 -75

300 300 300 300 300 300 300 300 300 300 resale price

Given:

• for the your payments of -250,-75,-75 the Discount rate is 10%(with ann. Compounding) ;
• the discount factor for cash inflows the Discount rate is 20% (with ann. Compounding) ;
• the estimated resale price is $1MM

Q.3 You have borrowed today $250K and have to pay for 30 years $1,000 monthly payments . What was your annual borrowing rate?(APR)

Q.4 You can afford to repay monthly $3000 for your dream car. If your APR borrowing rate is 8% (with monthly Compounding) , how much of a Porsche 911 can you buy , given that the loan has to be repaid in 60 months.

Q.5 Look up GameStop last Annual Report (summary in GameStop -Supplementary file)

and try to give a fair valuation of the stock