Linda Clark received $288,000 from her mother's estate. She placed the funds into the hands of a broker, who purchased the following securities on Linda's behalf: a. Common stock was purchased at a cost of $157,000. The stock paid no dividends, but it was sold for $281,000 at the end of three years. b. Preferred stock was purchased at its par value of $49,000. The stock paid a 8% dividend (based on par value) each year for three years. At the end of three years, the stock was sold for $20,000. c. Bonds were purchased at a cost of $82,000. The bonds paid annual interest of $3,500. After three years, the bonds were sold for $87,000. The securities were all sold at the end of three years so that Linda would have funds available to open a new business venture. The broker stated that the investments had earned more than a 14% return, and he gave Linda the following computations to support his statement: $124,000 Common stock: Gain on sale ($281,000 - $157,000) Preferred stock: Dividends paid (8% $49,000 x 3 years) Loss on sale ($20,000 - $49,000) Bonds: Interest paid ($3,500 x 3 years) Gain on sale ($87,000 $82,000) Net gain on all investments 11,760 (29,000) 10,500 5,000 $122,260 $122,260 = 3 years = 14.20% $288,000 $122,260 3 years = 14.20% $288,000 Click here to view Exhibit 12B-1 and Exhibit 12B-2, to determine the appropriate discount factor(s) using tables. Required: 1-a. Using a 14% discount rate, compute the net present value of each of the three investments. 1-b. On which investment(s) did Linda earn a 14% rate of return? 2. Considering all three investments together, did Linda earn a 14% rate of return? 3. Linda wants to use the $388,000 proceeds ($281,000 + $20,000 + $87,000 = $388,000) from sale of the securities to open a retail store under a 7-year franchise contract. What minimum annual net cash inflow must the store generate for Linda to earn a 12% return over the 7-year period