What is the maximum you should be willing to pay

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1. You are considering a project that promises you cash flows of 531 USD each year for 5 years. Based on the riskiness of the project, you require a 10 percent return. What is the maximum you should be willing to pay?

2. You are considering a project that promises you cash flows of 578 USD each year for 3 years. Based on the riskiness of the project, you require a 12 percent return. The cost to buy into the project is 3,489. What is the project NPV?

3. A share of common stock has just paid a dividend of $1.50 today. If the expected long-run growth rate for this stock is 7%, and if investors require a 13% rate of return, what should the fair price of the stock?

Reference no: EM132047261

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