A. SPU is considering a project where it would have a depreciation expense of $475,000 in the first year. If the marginal tax rate is 13%, the depreciations net effect on the FCF for year 1 is $_____.

B.

Probability	Expected Return
0.1	-15%
0.5	7%
0.3	11%
0.1	15%

Suppose a company has the probability distribution for annual returns described in the box above. What would the standard deviation be for this company?

C. Historically, company SPU has gone down in price about 1% whenever the overall market goes down in price by 3%. What number is most likely to be SPUs beta?

A. -3

B. 0.33

C. 3

D. -0.33

D. Suppose SPU has inventory of $150 on year 1, and $70 on year 2. This change in accounts receivable ____ the cash available to firm in year 2. In other words, the cash effect of change in accounts receivable on the year 2 operating cash flows is ____.

A. increases; $80

B. Cannot be determined, need more information

C. decreases; -$80

D. decreases; $80

E. increases; -$80