1. A rights offering is more important to some investors than to others. Why is this? Why are some investors so concerned about that, they might insist on having rights associated with future stock issuances?
2. Which mutually exclusive project would you select, if Project A costs $1,000 and Project B costs $1,200 and your required return is 15% for both project: Project A with three annual cash flows of $900; or Project B with 3 three annual cash flows of $1,000?