You are given $10 000 at the end of each year for the next three years.

1.If the interest rate is 7%, what is the present value of these cash flows?

2.What is the future value in three years of the present value you calculated in question (1)?

3.Now, you deposit the cash flows in a bank account that pays 7% interest per year. What is the amount in the account at the end of each of the next three years (after each deposit of $10000 is made)?

4.How does this final bank amount compare with your answer in question (2)? Please, explain.

Your parent invested some money in an account for you on the day you were born.

Since you are now 18 years old, you are allowed to withdraw the money for the first time.

The account currently has $42 000 in it.

The account pays a 12% interest rate per year.

1.How much money would be in the account if you left the money there until your 25th birthday?

2.Or, how much money would be in the account if you left the money there until your 65th birthday?

3.How much money did your parents originally invest in the account?

In mid-2019, EAY Inc. had $11 billion in debt, total equity capitalization of $89 billion, and an equity beta of 1.43. Included in EAY's assets was $21 billion in cash and risk-free securities. Assume that the risk-free rate of interest is 3% and the market risk premium is 4%.

a.What is EAY's enterprise value (you must use the Net Debt for the computation)?

b.What is the beta of EAY's business assets (unlevered beta), given that for the asset we have just found a value of 79 billion?

c.Using the CAPM, what is EAY's cost of capital i.e. WACC using the beta you have just calculated in the previous question (1^st method)?

d.Now, use at first the CAPM formula first in order to compute which is the return of the equity related to the equity beta of 1.43. You should find 8.72 %. Given this result, then compute the cost of capital i.e. WACC (2^nd method). You should find the same result as in the previous question.