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Kathy Myers frequently purchases stocks and bonds, but she is uncertain how to determine the rate of return that she is eaming. For example, three
Kathy Myers frequently purchases stocks and bonds, but she is uncertain how to determine the rate of return that she is eaming. For example, three years ago she paid $27,000 for 1,010 shares of Malte Company's common stock She received a $879 cash dividend on the stock at the end of each year for three years. At the end of three years, she sold the stock for $25,000. Kathy would like to earn a return of at least 7% on all of her investments. She is not sure whether the Malt Company stock provided a 7% return and would like some help with the necessary computations Click here to view Exhibit 138-1 and Exhibit 138-2, to determine the appropriate discount factors, using tables. Required: 1 Compute the net present value that Kathy earned on her investment in Malti Company stock, 2. Did the Malt Company stock provide a 7% return? Complete this question by entering your answers in the tabs below. Required Required Compute the net present value that Kathy earned on her investment in Malti Company stock. (Negative amounts should be indicated by a minus sign. Round your final answer to the nearest whole dollar amount.) Show less Net present value RA Required 2 >
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