Question 13 Colin has an inheritance that promises to pay him 7 year-end amounts of $5,000 starting exactly 2 years and 3 months from today. If he earns 4.4% p.a., how much is the inheritance worth in presentday dollars?

a. $26,841.03

b. $25,558.17

c. $28,022.03

d. $27,151.62

Question 14 Narrabri Cotton Ltd has been very profitable over the last year. The payment made to ordinary shareholders from the companys profit is called a.

a coupon.

b. a dividend.

c. a capital gain.

d. a margin.

Question 15 Charlotte is considering buying some preference shares in Georges River Aquaculture Limited. Charlotte thinks that a suitable value for the required rate of return for these shares is 8% per annum. The company will pay an annual dividend at the end of each year, commencing at the end of Year 3, as it will be three years before any fish can be sold. The dividend will be $2.50 per share, and is forecast to be paid forever. Based on this information, one preference share in Georges River Aquaculture Limited is worth approximately

a. $26.79

b. $24.89

c. $27.15

d. $25.42