QUESTION 9 Apple Equipment is considering the purchase of Orange Manufacturing. Apple Equipment believes that Orange Manufacturing can generate cash flows of $87,000 $92,000, and $98.000 over the next three years, respectively. After that time, Apple Equipment fools that Orange Manufacturing will be worthless. Apple Equipment has determined that a 8.7% rate of return is applicable to this potential purchase. What is the fair price for Orange Manufacturing (Hint: the value of the company is the PV of the future cash flows it generates) $268.467.30 $252,880.15 $246,735 47 $240,318.22 $234,201.54 QUESTION 10 What is the future value of the following cash flows at the end of year the interest rate is 4.0%? The cash flows cocur at the end of each year Year 1 Year2 $16.000 $19.000 $25,000 $60,231.70 $62,066.60 $64,358.72 $66.211.58 $70.415.00 QUESTION 11 Bruce Barber would like to establish a scholarship fund that will provide $24,000 a year forever. The scholarship fund is going to be invested very conservatively to the expected rate of return is only 1.80% How much money must he dopositoday to fund this scholarship lund? $1333,333 $1,100.067 $1,066,667 $1,033,333 QUESTION 12 Uncle George has promised to leave you an annuity that will pay $12.000 next year and grow at an annual rate of 2.5%. The payments are expected to go on indefnity and the interest rate is 4%. What is the value of the growing perpetuiti $760.000 $100,000 $140,000 $880,000 $420,000