The rate of interest is 2.95%. Which form of compounding will give the highest effective rate of interest? a. daily compounding b. monthly compounding c. annual compounding d. continuous compounding c. It is impossible to tell without knowing the term of the loan. Majestic Homes stock traditionally provides an 8% rate of return. The company just paid a S2 a year dividend which is expected to increase by 5% per year. If you are planning on buying 1.000 shares of this stock next year, how much should you expect to pay per share if the market rate of return for this type of security is 7% at the time of your purchase? What is the net present value of a project that has an initial cash outflow of $12.670 and the following cash inflows? The required return is 11.5%. a. $218.68 b. $370.16 c S768.20 d. SI.249.65 e. $1.371.02