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1. Using the appropriate supply and demand diagrams, show why market interest rates are rising when the economy is expanding.

2. In what respect is preferred stock similar to bonds, and in what respect is it similar to common stock?

3. If "r" is the annually compounded interest rate, what is the present value of a deferred perpetuity with annual payments of C beginning t years from now? Kindly give the formula.

Financial Management, Finance

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