Complete all questions below. SHOW ALL WORKING. The marks for this assignment will be awarded based on the accuracy of the statistical and mathematical calculations according to accepted standard practice.

For this assignment, you are required to form a company, and complete the following:

a. Provide a background to your company. 10 marks

b. Your company invests $500,000 in a Government Bond projected to earn 5% annually. Estimate the value of your investment after 10 years. 5 marks

c. You approach your local bank for a loan. The bank quotes a rate of 5.89% with an effective annual rate of 6%. Does the bank use annual, quarterly, or monthly compounding? 3 marks

d. Your company invested $5,500,000 in a project with expected cash flows of $1,000,000 at the end of Year 1, $1,500,000 at the end of Year 4, and $7,000,000 at the end of Year 5. Calculate the internal rate of return of the investment. 3 marks

e. The table shows a probability distribution for your companys EPS for the current fiscal year. What is the expected value of your companys EPS for the current fiscal year? 5 marks

Probability	EPS
0.15	$2.60
0.45	$2.45
0.24	$2.20
0.16	$2.00
1.00

f. Using the following projections for your business, show Probability Distribution of Annual Sales

Probability	Sales(millions)
0.6	300
0.0	450
0.2	400
0.1	425
0.05	470
Total = 1

A. Calculate the expected value of your annual sales. [2 Marks] B. Calculate the variance of your companys annual sales. [5 Marks] C. Calculate the standard deviation of your annual sales. [2 Marks] D. Interpret your findings from question 4a, b and c. [3 Marks]

g. Explain the concept of ANOVA, and say how you can conduct an ANOVA analysis for the wages/salaries of three categories of workers in your firm. Use an example to illustrate. Clearly indicate the F-Statistic and the Critical Value and their meanings. 12 marks