1. Which of the following are required for an acquisition to be considered tax free?
a. continuity of equity interest
b. a business purpse, other than avoiding taxes, for the acquisition
c. a payment in the form of equity shares for the acquired firm
d. cash payment for the equity of the acquired firm
2. Jamil invested $9,500 in an account he expects will earn 5% annually. Approximately how many years will it take for the account to double in value?
3. Your investment advisor wants you to purchase an annuity that will pay you $25,000 per year for 10 years. If you require a 7% return, what is the most you should pay for this investment?