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please answer 1-4 quations 1. Professor Gong bought a 150,000-shekel Honda Civic with 20 percent down and financed the rest with a four-year loan at
please answer 1-4 quations
1. Professor Gong bought a 150,000-shekel Honda Civic with 20 percent down and financed the rest with a four-year loan at 8 percent stated annual interest rate, but compounded monthly. What is his monthly payment if he starts the payment one month after the purchase? 2. You win the lottery. At what interest rate should you accept $7 million today over twenty annual payments of $500,000? 3. The Alpha firm makes pneumatic equipment. Its beta is 1.2. The market risk premium is 8.5 percent, and the current risk-free rate is 6 percent. What is the expected return for the Alpha firm? 4. Questions about the two Modigliani-Miller (MM) propositions: a. Briefly xplain the MM proposition I. b. Write down the MM proposition II formula, and derive it mathematically Step by Step Solution
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