Dr. Wong deposits today RM1,000 and the bank pays 6.0 percent annual rate of return which compounded quarterly. How much will he has in the account at the end of 3 years?

a. 2,012.00

b. 1,195.62

c. 1,012.00

d. 1,095.63

MNBs common stock currently sells for 50.00 per share, has an expected dividend to be paid at the end of the year of 2.50 per share, and has an expected growth rate to infinity of 5 percent per year. If investors required rate of return for this particular security is 12 percent per year, then this security is___________________________

a. overvalued and offering an expected return lower than the required return.

b. undervalued and offering an expected return lower than the required return.

c. overvalued and offering an expected return higher than the required return.

d. undervalued and offering an expected return higher than the required return.