1. Which of the following gift is a gift to a skip person?

a. Bob (age 50) makes a $50,000 gift to his godson David (age 11)

b. Carol (age 50) gives $75,000 to her niece Sally (age 10)

c. Jan (age 65) gives $25,000 to her friend Bill (age 45)

d. John (75) gives $100,000 to his grandson Joseph (30).

Joseph's mother (John's daughter) is not living at the time of the gift

2. Consider a 8-year project with the following information: initial fixed asset investment = $340,000; straight-line depreciation to zero over the 8-year life; zero salvage value; price = $27; variable costs = $13; fixed costs = $129,200; quantity sold = 60,724 units; tax rate = 33 percent. How sensitive is OCF to changes in quantity sold?

A) $12.10

B) $10.69

C) $6.66

D) $9.38

E) $0.11