4) Project A Project B Project C Project D Initial Investment Cash flow $21 million $12 million per year for three years $18 million $9 million per year for three years $15 million $6 million per year for six years $12 million $4.5 million per year for eight years An investor has a budget of $30 million. He can invest in the projects shown above. If the cost of capital is 5%, what investment or investments should he make? A) Project A B) Project B C) Project B and Project D D) Project C and Project D 5) Which of the following investments offered the lowest overall return over the past eighty years? A) S&P 500 B) small stocks C) Treasury bills D) corporate bonds 6) Suppose you invested $100 in the Ishares High Yield Fund (HYG) a month ago. It paid a dividend of $2 today and then you sold it for $95. What was your dividend yield and capital gains yield on the investment? A) -2%, 5% B) 2%, -5% C) 2%, 5% D) 5%, 2%