2. What continuously compounded interest rate will allow you to triple your money in 20 years? (Hint, assume any initial amount)

a. 5.65%

b. 5.98%

c. 6.86%

d. 6.92%

e. 8.99%

2. Domino Pizza firm has a 50% chance of producing a 25% return, a 30% chance of producing a 10% return, and a 20% chance of producing a -28% return. What is the firm's expected rate of return?

a. 9.41%

b. 9.65%

c. 9.90%

d. 10.15%

e. 10.40%

2. Asset A has an expected return of 15%. The expected market return is 14% and the risk-free rate is 4%. What is Asset A's beta?
   1. 0.50
   2. 0.75
   3. 1.1
   4. 1.8

2. A stock produced total returns of 10.4%, -11.9%, - 21.7%, and 31.2% over the past four years, respectively. What is the average rate of return for this period of time? A. 1.50% B. 1.67% C. 2.00% D. 2.34% E. 2.67%

2. Calculate the arithmetic return of an investment with five year returns of 10%, 6%, 4%, 2% and (10%). A. 2.41% B. 8.32% C. 9.32% D. 10.32% E. 11.32%

2. Which of the following statements is CORRECT?

1. A sunk cost is any cost that must be expended in order to complete a project and bring it into operation.
2. A sunk cost is any cost that was expended in the past but can be recovered if the firm decides not to go forward with the project.
3. A sunk cost is a cost that was incurred and expensed in the past and cannot be recovered if the firm decides not to go forward with the project.
4. Sunk costs were formerly hard to deal with, but once the NPV method came into wide use, it became possible to simply include sunk costs in the cash flows and then calculate the PV.
5. A good example of a sunk cost is a situation where Home Depot opens a new store, and that leads to a decline in sales of one of the firms existing stores.

2. Andy invests $2,050 at 6% simple interest. How much money will Andy have at the end of three years?

1. $2,419
2. $2,809
3. $2,950-01
4. $2,978
5. $3,000