1. Hammett, Inc., has sales of $71100, costs of $38300, depreciation expense of $12600, and interest expense of $500. If the tax rate is 37 percent, what is the operating cash flow, or OCF?
2. A 15-year annuity pays $1,500 per month, and payments are made at the end of each month. If the interest rate is 10 percent compounded monthly for the first seven years, and 6 percent compounded monthly thereafter, what is the present value of the annuity?
3. Find the market interest rate for a debt security given the following information: real rate = 2 percent, liquidity premium = 2 percent, default risk premium = 4
percent, maturity risk premium = 3 percent, and inflation premium = 3 percent.