1. Jamaica Corp. is adding a new assembly line at a cost of $6.0 million . The firm expects the project to generate cash flows of $1 million$2 million$3 millionand $4 million over the next four years. Its cost of capital is 16 percentWhat is the project's Modified Internal Rate of return (MIRR) and should the company add the new assembly line?

   1. 18.25 percent, no

   2. 21 percent, no
   3. 19 percent, yes
   4. 21 percent, yes
   5. 18.25 percent, yes

2. The expected rate of return on Kiwi Computers stock is 11 percent. If the risk free rate is 1.5, then what is the risk premium?

   1. 5%

   2. 4%

   3. 6%

   4. 2.5%