1. Suppose you have a project that has two possible outcomes in one year. In the successful state, the project pays off $1200 and this state occurs with a 60% probability. In the unsuccessful state the project pays $600. What is the expected payoff of the project one year from today?

2. Suppose you have a project that has two possible outcomes in one year. In the successful state, the project pays off $1200 and this state occurs with a 60% probability. In the unsuccessful state the project pays $600. Applying a discount rate of 25%, what is the expected value of this project today?

3. Suppose a project requires a $3000 investment today. In one year there are two possible outcomes: success that occurs with a 70% probability and pays out $4,500 and failure that occurs with a 30% probability and pays out $1000. You finance the project with a $1000 bond, payable in one year, and $2000 in stock. What is the expected payout to the bondholder?