1. "Cash flow methodology should distinguish between a new capital intensive business and a more mature operation." Discuss.

2. Tony borrowed $100,000 for twenty years at an annual effective rate of 8%. He will repay the loan with annual payments at the end of each year-his first payment is due one year from the loan date. The size of each payment will be $100 more than the payment in the previous year. How much will Tony still owe right after his fifth payment?

3. When investors are young, their investment portfolio should typically be dominated by common stocks because, due to long time horizons, young investors can generally afford the additional risk of common stocks. As investors near retirement, their asset allocation should rapidly shift to all fixed income securities to provide for income and to mitigate against the risk of the equity markets