solve all of them thank you so much!

10. What is the profitability index for the following set of cash flows if the required rate of return is 8% ? ( 5 points) 11. Corporation A is deciding on an acquisition. Corporation A would buy all shares of corporation B, for a total of 500,000 shares of B. Currently, corporation B is expected to pay a constant dividend forever of $12 per share. The market price of B shares reflects these expectations, and the required rate of return is 4%. A can buy B shares at their current market price, and management expects to be able to exploit synergies between the two corporations and increase revenues. Thus, according to A's management, if the acquisition takes place the dividend per share for next year is expected to be $12, but dividends are then expected to grow forever at a rate of 3% per year. The required rate of return on stock B would stay unchanged at 4%. What is the NPV of the acquisition? (5 points) 12. Corporation X produces pens. The corporation is deciding whether to build a new plant, for an initial investment of $100,000. The corporation projects to receive cashflows of $10,000 a year for 8 years by selling the output of the plant. Moreover, in year 9 the corporation could decide to convert the plant to produce a new product. The conversion would cost $8,000, and the new product would be sold for the following 40 years, with expected cash inflows per year of $30,000. The required rate of return for investments in pen production is 10% per year, while the one for investments in the production of new products is 15% per year. Say that you must commit to your decisions today. What would you do today and in year 9 ? How much value can be generated by the plant? ( 5 points) 1. An investment offers a total return of 12.3 percent over the coming year. Yellen thinks the total real return on this investment will be only 9 percent. What does Yellen believe the inflation rate will be over the next year? (5 points) 2. Wells Corporation issues the following three bonds. Assume they have same price, par value, and maturity. (5 points) A) Senior debenture, callable B) Subordinated debenture, callable C) Senior debenture, non-callable Sort these three bonds from the highest to the lowest coupon rate: 3. Ponzi Corp. pays a constant $5 annual dividend on its stock. The company will maintain this dividend for the next 9 years. The stock price in 10 years is going to be equal to $100. If the required return on this stock is 8 percent, what is the current share price? ( 5 points) 4. ABC Inc. just paid a dividend of $10 on its stock. The growth rate in dividends is expected to be a constant 5 percent per year indefinitely. Investors require a return of 12 percent for the first three years, a return of 8 percent for the next three years, and a return of 5 percent thereafter. What is the current share price? ( 5 points) 5. Consider a stock that is going to pay a dividend of $5 in year 1 . Dividends are going to be constant from year 1 to year 5 . From year 5 to year 6 dividends will grow at a rate of 6%. They will then grow at the rate of 5% each year forever. The required rate of return is 10%. What is the stock price today? (5 points) 13. At the end of the economic life of a machine, the salvage value is $1,500 while the book value is $800. Suppose that the marginal tax rate is 40%, what is the after-tax salvage value? (5 points) 14. Johnson Inc. is considering a new four-year expansion project that requires an initial fixed asset investment of $2.5 million. The fixed asset will be depreciated straight-line to zero over its four-year tax life, after which it will be worthless. The project is estimated to generate $2 million in annual sales, with costs of $800,000. a) If the tax rate is 35 percent, what is the OCF for this project? ( 3 points) b) Suppose the required return on the project is 13 percent. What is the project's NPV? ( 2 points) 6. The dividend yield on Super Factory Corporation common stock is 5.2 percent. The company just paid a $2.50 annual dividend and announced plans to pay $3 next year. The dividend growth rate is expected to remain constant at the current level. What is the required rate of return on this stock? (5 points) 7. Mac Corp. currently has an EPS of $4, and the benchmark PE for the company is 20 . Earnings are expected to grow at 5 percent per year. a. What is your estimate of the current stock price? ( 2 points) b. What is the target stock price in one year? ( 3 points) 8. Consider a project with an initial investment of $5,000, and future cash inflows of $600 per year for ten years. The IRR of the project is equal to the required rate of return. What is the NPV? (5 points) 9. Consider a project with the following cashflows. What is the IRR? For which required rates of return would you take this project? (5 points)