1. Bill is the owner of an ordinary annuity that will pay him $12,000 at the end of each of the next three years. This annuity has an annual rate of return of 7%. Given this information, what is the present value today of this annuity?
2. What the most important factor in making capital budgeting decisions and Why?
3. Family Foods, Inc. has a preferred stock issue outstanding that has a par value per share of $75.00. This preferred stock pays an annual divided that is 10% of its par value. Calculate the annual dividend paid per share on this preferred stock.